What are the characteristics of Indian money market?

What are the characteristics of Indian money market?
Charecteristics of Indian Money Market

1.Co-existence of organized and unorganized sectors:
The peculiar feature of the Indian Money Market isthe co-existence of organized and unorganized sectors. Theorganized sector consists of the Reserve Bank of India, State Bankof India and its affiliates, Commercial Banks, etc., The ReserveBank of India supervises these banks. Indigenous bankers and othersbelong to unorganized sector and thissector is not coming under thepurview of Reserve Bank of India. We can notice the lack ofco-operation and co-ordination between these two sectors.2.Lack of Integration:Indian Money Market is divided into several segments. They areloosely connected to each other. The various segments of IndianMoney Market are not well co-ordinated. It leads to unhealthycompetition among the segments.3.High volatile money market:Theimportant feature of the Indian Money Market is the seasonalstringency of funds. The demand for money in the Indian MoneyMarket is of seasonal in character. The money rates fluctuate fromone period to another because during busy season more money isdemanded.4.Diversified money rates of interest:Diversified money rates of interest is an important feature ofIndian Money Market. Since funds can not move freely from onesection to another, money rates of interest differ. Lack ofco-ordination among various segments of money market is alsoresponsible for diversified money rates of interest. But in recentyears Reserve Bank of India is making all efforts to bring down thediversity in interest rates.5.Absence of well organized bill market:Bill market in India is not organized and well developed. Themarket for government and semi government securities is also notpopular. Treasury Bill Market is also not well developed.6.Lack of well organized banking system:Existence of organized commercial banking system is pre requisiteof a developed money market. In India, the development ofcommercial banking is uneven and not adequate. There are only fewbig banks in the country which are extremely smaller in number.7.Limited availability of credit instruments:TheIndian Money Market does not have adequate short term creditinstruments. The important credit instruments are call money marketand treasury bills. However after 1988, Reserve Bank of Indiastarted introducing new instruments like 182 days treasury bill,364 days treasury bill, certificate of deposits, commercial papersetc.,8.Few Lenders:Thelenders in the Indian Money Market are few. Entry into the moneymarket is strictly regulated. But the borrowers are large innumber. Therefore this market is not very active and vibrant.9.Easy flow of foreign funds:Since 1991 foreign funds is easily flowing into India. Inspite ofthe flow it is not enough to meet the funds requirements of thecountry.10.Shortage of capital:Indian Money Market is facing the problem of capital shortage.Hence it can not meet the requirements of trade and commerce.Shortage is mainly due to low level of savings, inadequate bankingfacilities etc.,