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India to Launch Its First Tokenised Corporate Bond in September as State Owned REC Tests Blockchain Settlement

  • Writer: Shawn Jhanji
    Shawn Jhanji
  • 2 days ago
  • 2 min read
India will issue its first tokenised corporate bond next month, according to Reuters sources, as the country tests blockchain based instant settlement through a small pilot deal that places it alongside Europe and Hong Kong among jurisdictions actively experimenting with tokenised debt issuance. What happened State owned power financier REC is planning to issue the notes, expected to be valued at under 5 billion rupees, roughly 57 million dollars, with the launch slated for announcement at a major fintech event in Mumbai in September, according to reporting published 24 August 2026. India's central bank digital currency will be used to settle purchases of the tokenised bonds, and the pilot stage offering will be restricted to a select group of investors rather than opened broadly. Tokenised bonds record ownership, issuance, trading and settlement digitally on a blockchain or distributed ledger, in principle allowing transactions to complete almost instantly rather than over the multi day settlement cycles that still apply to most conventional bond trades. What it means The pilot is notable less for its size, which is modest, than for what it signals about where central bank digital currency infrastructure and tokenised securities are converging. Using a CBDC as the settlement leg for a tokenised bond removes one of the persistent obstacles that has slowed institutional tokenisation elsewhere: the absence of a trusted, regulated onchain cash equivalent.

India will issue its first tokenised corporate bond next month, according to Reuters sources, as the country tests blockchain based instant settlement through a small pilot deal that places it alongside Europe and Hong Kong among jurisdictions actively experimenting with tokenised debt issuance.


What happened


State owned power financier REC is planning to issue the notes, expected to be valued at under 5 billion rupees, roughly 57 million dollars, with the launch slated for announcement at a major fintech event in Mumbai in September, according to reporting published 24 August 2026. India's central bank digital currency will be used to settle purchases of the tokenised bonds, and the pilot stage offering will be restricted to a select group of investors rather than opened broadly.


Tokenised bonds record ownership, issuance, trading and settlement digitally on a blockchain or distributed ledger, in principle allowing transactions to complete almost instantly rather than over the multi day settlement cycles that still apply to most conventional bond trades.


What it means


The pilot is notable less for its size, which is modest, than for what it signals about where central bank digital currency infrastructure and tokenised securities are converging. Using a CBDC as the settlement leg for a tokenised bond removes one of the persistent obstacles that has slowed institutional tokenisation elsewhere: the absence of a trusted, regulated onchain cash equivalent.


The UK's own Digital Gilt Instrument pilot has faced a similar missing piece, according to recent reporting, with plans for a broader digital securities ecosystem still waiting on a comparable onchain cash solution. India moving first with a CBDC settled bond, even at small scale, gives UK policymakers and the Wholesale Digital Markets Champion taskforce a live case study to watch as they work toward their own goal of a live, end to end tokenised repo transaction by spring 2027.


What comes next


If the REC pilot settles cleanly, expect follow on issuance from other Indian state owned financiers and a renewed push from UK and European authorities to resolve the onchain cash question that has stalled comparable pilots domestically. For founders and platforms in the UK tokenisation space, the lesson is that regulatory sequencing, solving the settlement cash problem before scaling issuance, may matter more than headline issuance volume.


Key takeaways


  • REC, a state owned Indian power financier, plans to issue India's first tokenised corporate bond in September 2026, valued at under 5 billion rupees.

  • The bonds will settle using India's central bank digital currency, addressing the onchain cash gap that has slowed similar pilots elsewhere, including the UK's Digital Gilt Instrument work.

  • The pilot will be restricted to a select group of investors at launch.

  • The move places India alongside Europe and Hong Kong among jurisdictions actively piloting tokenised debt settlement, and offers a live reference point for the UK's own tokenised repo ambitions.


Sources:

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