The Legal Entity Identifier (“LEI”) code has been conceived as a key measure to improve the quality and accuracy of financial data systems for better risk management post the Global Financial Crisis. The LEI code is a 20-character unique identity code assigned to entities who are parties to financial transactions. In respect of the applicability of LEI, the Reserve Bank of India (RBI) has issued various notifications from time to time to cover entities that will have to apply for LEI code.
Since most of you will have questions regarding the applicability and procedure for registration for LEI code, we thought it will be appropriate to put them down in FAQ format.
FAQs1. What is LEI Code?
LEI Code is a 20-character unique identity code assigned to entities who are parties to financial transactions. Globally, it helps in labelling an entity with an Identity number that has entered into financing transactions and is registered with multiple agencies having varied registration numbers.
2. How does LEI code work?
LEI code is designed to enable the identification and linking of parties to financial transactions in order to manage counterparty risk. The goal is to improve the measuring and monitoring of systemic risk and support more cost-effective compliance with regulatory reporting requirements.
Read more about Applicability Of Legal Entity Identifier at Incorp Advisory India
