India Set to Launch First Tokenised Corporate Bonds With Digital Rupee

India's first tokenised corporate bonds are expected to launch next month in the form of an issue from REC worth less than Rs. 5 billion, using the digital rupee for settlement through blockchain technology. As per a report by Reuters, the state-backed power financing company REC will issue these bonds under an experiment being conducted jointly with the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI). The proposed bond issuance will help determine whether distributed ledger technology could reduce the time taken for issuance and settlement of corporate bonds.

Pilot To Use Separate Wallets For Digital Currency And Tokenised Securities

The Report further says that ownership and transaction data will be kept in a digital format, and settlement can happen almost instantly after the necessary assets change hands among the participants. A source who was familiar with the plans said in an interview with Reuters that the product would be launched at the annual fintech event in Mumbai. Initially, only a select few investors would have access to the product.

The Reuters sources revealed that the participants of the test run would require two digital accounts. The first account is for the wholesale central bank digital currency wallet provided by the bank, and the other one is for the tokenised securities. The securities wallet of India is being developed by depositories under a system called DEMAT 2.0, where bonds that the investors own will be recorded using distributed ledger technology. Any transactions after that can only be conducted through investors who have compatible securities and wholesale CBDC wallets.

The use of the RBI's digital rupee as the cash element of the deal will allow both the cash and the securities to be transferred using the interconnected digital infrastructure. This arrangement is aimed at testing out the settlement process without using the bonds from the traditional e-book service provider system. 

As per the new arrangement, the bonds would come with an initial lock-in period of three months. The exchanges would also be looking to create a secondary market for these tokenised bonds until December, one of the sources said. Participants who own the necessary wallets can exchange the securities on the secondary market once the lock-up period expires. The platform will maintain the history of ownership of the bond on the distributed ledger in case of security transfer between authorised investors.

Earlier in October 2025, Union Minister Piyush Goyal announced that the government is looking to introduce a digital currency backed by the RBI, while adding that the government does not support private cryptocurrencies that lack asset backing. In contrast to conventional banking systems, the RBI-guaranteed digital currency is meant to streamline transactions, enable faster and traceable payments, and reduce paper consumption.