Which of the following are the participants in T-Bills Market?

A. Reserve Bank of India

B. Commercial Banks

C. Foreign Banks

D. Provident Funds

E. Corporates

Choose the correct answer from the options given below:

Correct option is D

The Treasury Bills (T-Bills) market is an integral part of the money market, where short-term securities issued by the government are traded. Participants in this market include:
1. Reserve Bank of India (A): Acts as the manager of government securities and ensures smooth operation in the T-Bills market.
2. Commercial Banks (B): Actively participate as buyers and sellers in the T-Bills market to manage liquidity and comply with statutory liquidity ratio (SLR) requirements.
3. Foreign Banks (C): Participate to manage liquidity and meet investment needs.
4. Provident Funds (D): Invest in T-Bills as they are safe and provide a fixed return.
5. Corporates (E): Invest in T-Bills for short-term fund parking and cash management.
Information Booster:
· Treasury Bills (T-Bills): Short-term government debt instruments with maturities of 91, 182, or 364 days. They are issued at a discount and redeemed at face value, with no interest paid during the tenure.
· The T-Bills market ensures liquidity management for participants and serves as a risk-free investment avenue.