Exclusive-India plans first tokenised bond issue in September, sources say

India is set to launch its first tokenised corporate bonds issue in September, according to sources familiar with the matter. The state-owned power financier REC will issue bonds worth less than 5 billion rupees in the pilot offering, which is expected to be unveiled at a financial technology event in Mumbai. This move puts India alongside markets such as Europe and Hong Kong in embracing blockchain technology for bond issuance and settlement.

India's markets regulator and central bank are collaborating on the technology initiative. Tokenised bonds, recorded digitally on a blockchain, enable almost instant transactions. The bonds will require investors to access two digital accounts: a wholesale digital currency wallet and a new electronic securities wallet. Investors will need to hold both compatible CBDC and securities wallets to trade the bonds.

The securities will not be traded on the conventional electronic book provider platform, and subsequent trades can only occur between participants with compatible digital wallets.