India to launch first tokenised bond issue in September

India will launch tokenised corporate bonds next month, with state-owned power financier REC issuing bonds worth less than Rs 5 billion, three sources told Reuters. The bonds will be settled using India's central bank digital currency, the digital rupee, and will be recorded on a blockchain or distributed ledger. The pilot, run with the RBI and SEBI, will test whether the technology can enable instant settlement of bond transactions.

Investors will need two digital accounts: a wholesale digital currency wallet from a bank and a new electronic securities wallet called DEMAT 2.0, being developed by depositories. The offering is expected to be unveiled at a financial technology event in Mumbai next month and will initially be available to a select group of investors. Exchanges are expected to develop a secondary market by December.