Central Idea

The government announced the 28th tranche of Electoral Bond sales, scheduled to take place over a ten-day span at authorized branches of the State Bank of India.

Why discuss Electoral Bonds?

Impact on Political Funding: The announcement of the upcoming electoral bond sale has implications for political funding in India. As part of the government’s efforts to reform the political financing system, electoral bonds aim to bring transparency and accountability to campaign financing.
Upcoming Elections: The timing of the sale window aligns with the upcoming assembly elections in some States, highlighting the significance of electoral bonds in shaping the financial landscape of political campaigns.
Continued Scrutiny: The use and impact of electoral bonds continue to be a subject of debate and scrutiny, with stakeholders assessing their role in enhancing or altering the political funding ecosystem in the country.

Definition	Banking instruments for political party donations with donor anonymity.
Purchase Method	Available to Indian citizens and Indian-incorporated companies from select State Bank of India branches. Can be bought digitally or via cheque.
Donation Process	Purchasers can donate these bonds to eligible political parties of their choice.
Denominations	Available in multiples of ₹1,000, ₹10,000, ₹10 lakh, and ₹1 crore.
KYC Requirements	Purchasers must fulfill existing KYC norms and pay from a bank account.
Lifespan of Bonds	Bonds have a 15-day life to prevent them from becoming a parallel currency.
Identity Disclosure	Donors contributing less than ₹20,000 need not provide identity details like PAN.
Redemption	Electoral Bonds can be encashed only by eligible political parties through an Authorized Bank.
Eligibility of Parties	Only parties meeting specific criteria, including securing at least 1% of votes in the last General Election, can receive Electoral Bonds.
Restrictions Lifted	Foreign and Indian companies can now donate without disclosing contributions as per the Companies Act.
Objective	To enhance transparency in political funding and ensure funds collected by political parties are accounted or clean money.