The Clearing Corporation of India (CCIL) was set up to improve efficiency in the transaction settlement process, insulate the financial system from shocks emanating from operations related issues, and to undertake other related activities that would help to broaden and deepen the Money, Gilts and Forex markets in India. The role of CCIL is unique, as it provides guaranteed settlemen4.t of three different products under one umbrella.
Apart from settlement of trades, another major function of a Clearing Corporation is to reduce risks of its members from failed trades arising out of the defaults by their counterparties. By becoming central counterparty to the trades done by its members, the Corporation absorbs risk. It manages the risks through its risk management processes in such a manner that the ultimate risk to its members from fails is either eliminated or reduced to the minimum. Risk Management Department in CCIL has been entrusted with the responsibility of designing the Risk processes and its execution. The department is also responsible for keeping the processes efficient, current and user friendly.
The success of its money market product ‘CBLO’ has helped the market participants as well as the central bank to find a solution to unusual dependence on uncollateralized call market.