India settles $116 million in tokenized corporate bonds
India’s first distributed-ledger bond issuance clears 102.5 billion rupees via the digital rupee.
India issued 1,025 crore rupees in tokenized corporate bonds. This represents approximately 116 million dollars in new financing. Three separate transactions completed the total volume. All settlements used the Reserve Bank of India’s wholesale digital rupee. The pilot program is known as Demat 2.0. It connects distributed ledgers to central bank currency.
REC Limited raised 500 crore rupees from 18 investors. Larsen & Toubro secured 500 crore rupees from four buyers. IIFL completed a smaller issuance of 25 crore rupees. These deals mark India’s first native distributed-ledger corporate bond issuances. The transactions settled through the RBI’s Unified Market Interface. Payment and asset delivery occurred atomically.
Atomic settlement eliminates delivery risk
The system moves bonds and payments together. This prevents one leg of a trade from failing. Conventional processes often take two to three days for funds to clear. Issuers now receive payment on the bidding day. This reduces settlement risk significantly. The regulator describes this as a core feature of the pilot.
Investors hold these securities through existing demat accounts. They do not need separate securities accounts. Participants must activate Demat 2.0 with their depository. A wholesale digital rupee wallet is also required. This ensures payments settle in central bank currency. The structure maintains standard legal rights for bondholders.
Market size remains modest relative to total
India’s corporate bond market is valued at 53.64 lakh crore rupees. This equals approximately 627 billion dollars. The new pilot issuance is a small fraction of this total. SEBI has not set a target for future volumes. The current issuance volume is 1,025 crore rupees. Future phases will add secondary trading capabilities.
The bonds retain fixed interest rates and maturity dates. Credit ratings and exchange listings continue to apply. Debenture trustees remain part of the legal framework. Ownership records sit on a regulated distributed ledger. This approach differs from single-issuer platforms seen elsewhere. The integration uses statutory depositories for record-keeping.
Regulators launch pilot at fintech event
SEBI and the RBI announced the project in Mumbai. The presentation occurred at the Global Fintech Fest. SEBI Chairman Tuhin Kanta Pandey led the announcement. RBI Governor Sanjay Malhotra joined the presentation. They highlighted the connection between ledgers and currency. The goal is to streamline bond market operations.
GN auto markets/bonds: corporate bonds reports note the structural shift. The pilot changes how settlement is recorded. It does not create a new security category. Repayment obligations for issuers remain unchanged. Retail access is planned for later phases. Existing RFQ platforms will support future trading.
