The Reserve Bank of India has announced that, from November 6, 1998 (Friday) the auction of 91-day Government of India Treasury Bills will be conducted by means of "Uniform Price Auction" method. In the case of auctions of other Treasury Bills and Government Dated Securities, the existing practice of making allocations by means of "Multiple Price Auction" method would, however, continue.

While in the case of "Multiple Price Auction" (also called "Discriminatory Price Auction") method, successful bidders would be paying their own bid prices, in the case of "Uniform Price Auction" method, all successful bidders would be paying a uniform price, i.e., the cut-off price emerged in the auction. Thus under the "Multiple Price Auction" system, bidders will have to pay a premium, which is the difference between the price quoted by the bidder and the cut-off price fixed in the Auction. This is called "Winners' Curse".

Thus as against "Multiple Price Auction" method, "Uniform Price Auction" method would eliminate the payment of premium by the bidders.