India has launched Demat 2.0, a pilot project for issuing tokenized corporate bonds settled in digital rupee. The initiative, developed by the Securities and Exchange Board of India (SEBI) and the Reserve Bank of India (RBI), was unveiled at the Global Fintech Fest in Mumbai.
The system utilizes the Unified Market Interface to link bond records on a distributed ledger with the RBI’s wholesale digital rupee. This integration enables simultaneous delivery of assets and payments, reducing settlement risks. The project involves major entities including NSDL, CDSL, NSE, BSE, HDFC Bank, and ICICI Bank.
Three companies have already issued bonds totaling ₹10.25 billion ($107 million). REC and Larsen & Toubro raised ₹5 billion ($52.2 million) each, while IIFL raised ₹250 million ($2.6 million). REC's initial issuance on September 7 featured a 7.3% interest rate.
The pilot currently limits participation to institutional investors who possess a central bank digital currency wallet and access to the Demat 2.0 infrastructure. Future plans include automating interest payments via smart contracts, enabling secondary market trading, and expanding access to retail investors.
