Axis Securities, a subsidiary of Axis Bank today became the first bank-sponsored broking entity to take membership of commodity derivatives exchange, Multi Commodity Exchange of India (MCX) after the Reserve Bank of India (RBI) allowed banks to provide broking services in commodities derivatives.
The participation of such entities backed by financial institutions in the commodity derivatives market is expected to provide great impetus for the overall development of the commodities market here.
At the same time, it would provide banks and their broking arms new business opportunities, especially given their large customer base and vast network of branches across the country.
"With Indian commodity bourses extending membership to bank broking divisions, a whole new world of opportunities has opened up for us, by adding more depth and vigour with the commodity offering," Axis Securities managing director Arun Thukral said in a statement here.
With Axis Securities becoming the first bank broking subsidiary to take membership of MCX, it is expected that other such entities would follow. "Through the large distribution network and reach of Axis, the exchange platform stands extended to a very large section of individuals, MSME and SMEs across the country," MCX managing director Mrugank Paranjape said.
This would go a long way in bringing the larger physical market in commodities to the commodity derivatives market, he added.
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