India Unveils Tokenized Corporate Bond Pilot with Blockchain Settlement

India is set to launch a pilot program for tokenized corporate bonds in September. The initiative, led by REC Limited, a state-owned power sector financing company, will test the use of blockchain-based settlement and wholesale Central Bank Digital Currency (CBDC) payments.

The pilot aims to issue less than 5 billion rupees, or approximately $57 million, in tokensized bonds to a select group of investors. Participants will require two digital accounts: a bank-provided CBDC wallet for payments and a securities wallet called DEMAT 2.0 developed by Indian securities depositories.

The system will record bond ownership on distributed ledger technology, enabling the asset and payment legs to interact through digital infrastructure. This design builds upon India's earlier wholesale e-rupee experiments, which began in 2022 with a focus on government securities settlement.