Author : Subhamoy Chatterjee
published in : RePEc-IDEAS
Interest rate derivatives (IRDs), especially interest rate swaps, are widely used as risk management tools across industries to manage interest rate exposure and optimise debt structures. Research shows their strategic importance in sectors like banking, corporates, and healthcare, where they enhance financial flexibility and reduce borrowing costs.
However, existing studies are largely concentrated in developed economies, with limited focus on emerging markets such as India and on small and mid-sized firms. The literature also lacks a comprehensive, systems-based approach, often analysing IRDs from isolated perspectives like strategy, regulation, or accounting.
Key gaps include insufficient research on regulatory disclosures, motivations behind derivative usage, and cross-sector integration. Future research should adopt a holistic, multi-dimensional framework to better understand and improve the effectiveness of IRDs in risk management across diverse markets and sectors.
