The Securities and Exchange Board of India (SEBI) and the Reserve Bank of India (RBI) on Thursday launched “Demat 2.0”, a pilot framework for tokenised corporate bonds using distributed ledger technology (DLT) and the central bank digital currency (CBDC).
SEBI Chairman Tuhin Kanta Pandey said the initiative does not create a new asset class or require investors to open a new demat account or complete a fresh KYC process.
DLT will be used for the securities leg and CBDC for settlement, allowing the movement of securities and money simultaneously through atomic settlement rather than sequentially. “This is not like that, this is regulatory and not a new asset class,” Pandey said.
The first phase of the pilot has already been completed with three issuers. REC Ltd became the first issuer to conduct a tokenised corporate bond pilot under SEBI’s regulatory sandbox framework, raising ₹500 crore through the issue. The bonds carry a 7.30 per cent coupon and have a tenor of one year and nine months.
Tuhin Kanta Pandey, chairman of Securities and Exchange Board of India (SEBI), during the Global Fintech Fest in Mumbai, India, on Thursday, Sept. 10, 2026.
| Photo Credit: DHIRAJ SINGH
Pandey said the next phase would introduce secondary-market transfers and trading in a controlled environment, before the system is eventually opened to retail investors.
SEBI sees the existing depository system, CBDC infrastructure and electronic corporate bond platforms as key advantages for the project.
“There is no parallel market. There is no liquidity divide. Asset is same. There is no new Demat account. There is no need for a new KYC,” Pandey said.
The regulator also plans to examine the use of DLT for functions such as pledging, covenant monitoring and automated servicing of bonds, including coupon and repayment processes.