India is moving towards a new digital securities model, with its first tokenised corporate bond issue expected next month. State-backed power financing company REC is expected to issue bonds worth less than ₹5 billion, using the digital rupee for settlement through blockchain technology.
The issue will be part of a joint experiment involving REC, the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI). The pilot will test whether distributed ledger technology can reduce the time needed to issue and settle corporate bonds.
Ownership and transaction records will be maintained digitally, allowing settlement to take place almost instantly after the required assets are transferred between participants.
A source familiar with the plans said the product is expected to be launched at the annual fintech event in Mumbai. Initially, access will be limited to a select group of investors.
Participants in the pilot will need 2 digital accounts. One will be a wholesale central bank digital currency wallet provided by a bank, while the other will be used for tokenised securities.
India’s securities wallet is being developed by depositories under a system called DEMAT 2.0. Bonds held by investors will be recorded using distributed ledger technology. Further transactions will only be possible between investors with compatible securities and wholesale CBDC wallets.
The RBI’s digital rupee will serve as the cash component of the transaction. This will allow cash and securities to move through interconnected digital infrastructure and test settlement without relying on the traditional e-book service provider system.
The bonds will initially have a 3-month lock-in period. Exchanges are also expected to develop a secondary market for the tokenised bonds by December, according to a source.
Once the lock-in period ends, investors with the required wallets will be able to trade the securities in the secondary market. The platform will maintain the ownership history of each bond on the distributed ledger when securities are transferred between authorised investors.
In October 2025, Union Minister Piyush Goyal said the government was looking to introduce an RBI-backed digital currency and did not support private cryptocurrencies without asset backing.
The RBI-backed digital currency is intended to enable faster, traceable transactions while reducing paper use compared with conventional banking systems.
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