Secured Overnight Rupee Rate

Interest rate benchmarks worldwide have moved away from rates built on quotes — what a panel of banks say they would charge each other — toward rates built on actual transactions. India's move in that direction is the Secured Overnight Rupee Rate, or SORR.

The workbook's own description: FBIL "has introduced the Secured Overnight Rupee Rate (SORR)—a trade-based benchmark derived from actual repo transactions—to replace MIBOR for better transparency and global alignment."

Two features define SORR, both stated directly by the workbook:

1. Trade-based, not quote-based. SORR is derived from actual repo transactions — real trades that happened — rather than from rates that panel banks merely report or estimate.
2. Secured. Being built from repo transactions, SORR is anchored to borrowing that is collateralised by securities, unlike an unsecured interbank benchmark.

SORR sits within FBIL's broader role in the interest rate derivatives market: providing the reference rates used in pricing and settling products such as interest rate swaps, promoting standardisation and liquidity through robust benchmarks, and supporting risk management of interest rate exposure in derivative contracts. The workbook frames SORR's introduction specifically as a step toward conforming to global standards in benchmark reform — the same direction regulators worldwide have pushed other interbank offered rates.

The workbook does not give a formula, calculation methodology, or a current published rate for SORR — only that it is trade-based, repo-derived, and intended to replace MIBOR. Where the workbook is silent on the mechanics, that detail should not be assumed.

A bank and a corporate treasury enter a new overnight indexed swap referencing SORR instead of Overnight MIBOR, on a notional of Rs 100 crore. Where MIBOR's daily fixing has historically drawn on polled or reported rates from a panel, SORR's fixing for that same day is instead built from the actual overnight repo trades that took place in the market that day — a rate grounded in what genuinely changed hands, rather than in what participants say they would charge.

If market participants gradually shift new IRD contracts from MIBOR references to SORR references over time, that shift is exactly the kind of transition global benchmark reform has driven in other markets — moving derivative pricing onto a rate that is harder to manipulate because it is anchored to real, collateralised transactions.

Chapter 8 (Regulatory Environment for Exchange Traded IRD), section 8.6.1 (Role of Financial Benchmarks India Private Ltd.), introduces SORR as part of FBIL's role in the interest rate derivatives market, immediately after FBIL's benchmark administration and government securities valuation functions. Expect a recall question on what SORR is meant to replace (MIBOR) and what it is derived from (actual repo transactions).

• SORR is trade-based; it replaces a benchmark that was more reliant on polled/quoted rates. The contrast with MIBOR is the point being tested.
• "Secured" refers to SORR being derived from repo transactions, which are collateralised — not to any guarantee on the rate itself.
• The workbook gives no calculation methodology or numeric example for SORR — do not invent one; the stated facts are limited to what it is derived from and why it was introduced.
• FBIL introduced SORR; do not attribute its introduction to FIMMDA or to an exchange.