India's tokenized bonds help REC, L&T IIFL raise ₹1,025 cr
India is shaking up its bond market with tokenized bonds (basically, digital versions of regular bonds powered by blockchain).
This upgrade could eventually mean faster transactions, more efficient settlement, and reduced dependence on multiple intermediaries.
Big players like REC, Larsen & Toubro, and IIFL have already raised ₹1,025 crore using this new system.
UMI settlements, smart contracts, integration hurdles
Tokenized bonds are just traditional debt made digital. They operate on blockchain-based Distributed Ledger Technology (DLT) and settled simultaneously using the Reserve Bank of India's digital rupee through the Unified Market Interface (UMI), so there's less waiting around.
Smart contracts even automate interest payments.
While this tech could make investing smoother for institutional investors, it will need to clear some hurdles around liquidity and system integration before it really takes off in India.