CCIL commenced settlement of forex operations from 08^th November, 2002 covering inter-bank USD/INR spot and forward trades. From February, 5 2004 cash and Tom trades were included for guaranteed settlement. The netting scheme adopted by CCIL is netting by novation. The netting scheme adopted by CCIL is netting by novation where the bilateral relationship between the two participants/members is substituted with bilateral contracts between each participant/member and CCIL. The multilateral netting system provides a netting benefit of well over 85%.

Details of eligible trades done are received from members in a prescribed format. The trades are validated and matched. Matched trades are subjected to an exposure check and trades that pass such exposure check are ‘Accepted’ for settlement. The matched Forward deals are guaranteed for settlement from S-2 day and Cash, Tom, Spot deals are guaranteed for settlement from trade date

Various reports are generated to update members on the status of deals reported by it to CCIL and the net settlement obligations that become due to and from them. These reports are accessed by members over a Report Browser on their INFINET network

The rupee leg is settled through the member’s current accounts with RBI and the USD leg through CCIL’s account with the Settlement Bank at New York.