India’s markets regulator and central bank have switched on a tokenized corporate bond market, with three issuers raising a combined 10.25 billion rupees, or about $107M, on the new rails.
Under the new system a bond is no longer a certificate that gets digitized later. It is created as a token from the start, held on infrastructure run by India’s statutory depositories. A Unified Market Interface ties that ledger to the Reserve Bank’s wholesale central bank digital currency, so cash and securities move together.
Public-sector lender REC raised 5 billion rupees from 18 investors, engineering group Larsen & Toubro added another 5 billion from four, and non-bank lender IIFL issued 250 million rupees to a single investor.
SEBI said atomic settlement lets issuers receive funds the same day instead of two or three days later, and that smart contracts can automate interest and redemption payments. Investors use existing demat accounts with no new identity checks, though they must enable Demat 2.0 and hold a wholesale CBDC wallet to settle.
The regulator said later phases will add secondary trading through existing request-for-quote platforms and open the bonds to retail investors. It also claimed a first: bonds issued natively on a distributed ledger, ownership recorded by statutory depositories and settlement in central bank digital currency, all inside regulated infrastructure.
The pilot reaches a corporate bond market worth roughly $620B, but tokenization changes none of the underlying legal obligations or investor protections. For fintech builders, the signal is that regulated settlement rails, not crypto venues, are where institutional tokenization is landing.
