India plans first tokenised corporate bonds

• India plans to issue its first tokenised corporate bonds next month, according to a Reuters report.
• REC is expected to issue the bonds, with settlement likely using India’s digital rupee.
• The pilot will initially be available to a limited group of investors.

India plans to test its first tokenised corporate bonds next month, according to a Reuters report citing three sources.

The pilot will test blockchain-based bond trading and settlement as India explores distributed ledger technology for financial markets.

REC, a state-owned power financing company, is expected to issue the initial bonds under the pilot.

Settlement is expected to use India’s central bank digital currency, known as the digital rupee, which has been under pilot since 2022.

The pilot will initially be offered to a limited group of investors, while details on the schedule and framework remain undisclosed.

Tokenised bonds represent traditional bond ownership as digital tokens recorded on blockchain or distributed ledger systems.

The pilot could test whether tokenisation can reduce settlement times and costs while improving liquidity in India’s corporate bond market.