India's SEBI Demat 2.0 pilot debuts with over $100 million in tokenized bonds

By Brian Danga • Edited by James Hunt
Regulation•September 11, 2026, 8:09AM EDT
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India's SEBI Demat 2.0 pilot debuts with over $100 million in tokenized bonds

Quick Take

  • Three Indian issuers have raised â‚ą1,025 crore ($107.2 million) through tokenized corporate bonds under SEBI’s Demat 2.0 pilot.
  • The pilot links tokenized bonds to RBI’s wholesale CBDC for atomic settlement, with the first phase focused on issuance.
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India's securities watchdog announced on Thursday that three issuers raised â‚ą1,025 crore ($107.2 million) through tokenized corporate bonds under its Demat 2.0 pilot.

The Securities and Exchange Board of India said in a statement that the system uses distributed ledger technology to issue, hold, and settle corporate bonds.

According to the statement, REC Ltd. was the first issuer on Sept. 7, raising ₹500 crore ($52.3 million) from 18 investors. L&T Ltd. followed on Sept. 9 with a similar amount from four investors, while IIFL raised ₹25 crore ($2.6 million) from one investor the same day. 

SEBI said the infrastructure behind Demat 2.0 pilot records corporate bonds as native digital tokens on a distributed ledger owned by the depositories. It connects to the RBI's wholesale CBDC through the central bank's Unified Market Interface, allowing the bond and the cash leg to settle atomically.

According to the regulator, this reduces the settlement risk associated with separate securities and funds transfers. It could also give issuers access to proceeds on the same day after bidding, compared with the usual two to three days under the existing process.

"On the shared ledger, the details of bondholder are visible to all authorized institutions at once, and payment in e₹ reaches the bondholders' CBDC wallets on the due date," the regulator said. "Taken together, these features are expected to make the issue,  settlement, and servicing of corporate bonds faster, more efficient, and less error‑prone."

The securities watchdog clarified that the pilot does not create a separate class of corporate bonds. Tokenized bonds retain the same ISIN, issuer obligations, coupon, maturity, covenants, rating, and investor rights as conventional dematerialized bonds, according to the statement.

The pilot runs in three stages. The first phase covers institutional issuance, with secondary trading and retail access slated for later phases under SEBI's Regulatory Sandbox.