New Delhi, April 16 -- A working group constituted by the Indian market regulator is discussing measures to improve the country's stock lending and borrowing framework through greater custodian participation and digitization of the Securities Lending and Borrowing Scheme (SLBS) processes, three people aware of the development said.

The move is part of a push by chairman Tuhin Kanta Pandey to deepen cash markets and offer investors alternatives to the risky derivatives segment.

The key part of the discussions is a plan to push custodians to actively pitch the scheme to investors whose shares they safeguard. Currently, the process is hampered by 'prohibitive' 125% margin requirements and a manual trading system that relies on phone calls ...