India’s First Tokenised Bond Finds Strong Backing from HDFC, ICICI and Other Major Players

In a move that could reshape India’s corporate debt market, power‑financier REC Ltd. successfully issued the country’s first tokenised bond. The 5 billion‑rupee tranche, carrying a 7.30 % coupon and maturing in May 2028, attracted a diverse set of investors – roughly twenty in total – ranging from big‑ticket banks to boutique asset managers.

Among the headline names were HDFC Bank and ICICI Bank, both of which took a sizeable slice of the issue. They weren’t alone; Axis Bank, Yes Bank, AK Capital Services, ICICI Securities’ primary dealership arm, Taurus Group and Trust Investment Advisors also signed up. Even though many participants asked to stay off the record, the consensus was clear – the market is curious, if not excited, about tokenised securities.

The settlement itself was a first for India: investors used the Reserve Bank of India’s digital currency (the CBDC) to complete the purchase. By marrying blockchain‑based tokens with a central‑bank digital payment system, the whole process was reportedly faster and smoother than a traditional bond allotment.

"The biggest advantage is speed and settlement efficiency," said Amar Gandhi, founder and managing director of Taurus Group, which helped arrange the deal. "When you link tokenised securities with the RBI’s digital currency, you cut out a lot of the friction that slows down the usual bond workflow."

Tokenisation, at its core, means that each bond is represented as a digital token on a blockchain, allowing for near‑real‑time trading, transparent ownership records and potentially tighter liquidity. If this pilot proves successful, it could pave the way for a deeper, more resilient corporate bond market in India.

Industry watchers noted that Larsen & Toubro Ltd., the nation’s largest engineering conglomerate, is already flirting with the idea, having floated a three‑year tokenised note to raise up to another ₹5 billion. While L&T declined to comment on its plans, the interest from such a heavyweight signals that tokenised debt might soon become a mainstream financing tool.

For now, REC’s experiment serves as a proof‑of‑concept. It demonstrates that major banks are willing to dip their toes into blockchain‑enabled finance, and that the RBI’s digital currency can be leveraged for real‑world settlement. Whether this translates into broader adoption remains to be seen, but the early signs are certainly encouraging.