SEBI and RBI open a Demat 2.0 tokenised bond pilot

Demat 2.0 is not a new bond. On September 10, 2026, the Securities and Exchange Board of India (SEBI) said corporate bonds had been issued as native tokens on a distributed ledger, with ownership still at the statutory depositories and the cash leg in central bank digital currency, inside the market those bonds already use. That is a register-and-money design, not a token that still has to prove it sits on the share register.

The record is SEBI press release PR No. 56/2026. It says Governor Sanjay Malhotra of the Reserve Bank of India (RBI) and Chairman Tuhin Kanta Pandey of SEBI announced the pilot together at the Global Fintech Fest in Mumbai. The release does not attach a separate RBI statement. Three companies had already issued tokenised bonds aggregating ₹1,025 crore. REC Limited, a public-sector non-banking financial company (NBFC), raised ₹500 crore from 18 investors on September 7. L&T Limited raised ₹500 crore from four investors on September 9. IIFL, a private NBFC, raised ₹25 crore from one investor the same day. First-phase issuance is ongoing. Later phases are meant to add trading on existing request-for-quote (RFQ) platforms and access for retail investors. SEBI has not dated either step.

The token is the bond

SEBI's frequently asked questions (FAQs) say "The token is the corporate bond." It remains a security under the Securities Contracts (Regulation) Act, 1956, with the same International Securities Identification Number (ISIN), coupon, maturity, rating and investor rights as a conventional dematerialised bond. Tokenisation does not create a new asset class. The ledger is private and permissioned, and the depositories own it. Demat 2.0 links to the RBI's wholesale central bank digital currency (CBDC), the e₹, through the Unified Market Interface, so the bond and the money move together or neither leg settles. Depositories hold the keys. A Demat 2.0 account extends the existing demat account and reuses existing know-your-customer (KYC). The issuer needs a CBDC wallet rather than a new demat account. Bidding stays on the exchange Electronic Bidding Platform.

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Pandey's published address says the three issues were led by Central Depository Services (India) Limited (CDSL) and National Securities Depository Limited (NSDL), supported by BSE, MSEI and the National Stock Exchange of India (NSE). The FAQs add technology support from the National Payments Corporation of India (NPCI). SEBI calls that design a first, set against issuer-by-issuer tokens on separate platforms, not a claim that the bond market has moved.

Where the risk claim stops

Pandey's address is more conditional than the press note. He said: "Today, we will symbolically launch a pilot project on tokenisation of corporate bonds under demat 2.0 in the Indian securities market. It explores whether distributed ledger technology can bring the security and settlement legs closer together, enable faster settlement and automate parts of asset servicing."

The release lists settlement risk as "eliminated because of atomic settlement," and says proceeds that generally took two to three days after bidding arrive on the bidding day. The FAQs are narrower. Before secondary trading is switched on, a peer-to-peer transfer's payment leg may sit outside atomic settlement, through CBDC or ordinary bank channels. The risk claim describes the linked system, not every exit while only the first stage is live. The release does not confirm that each September print settled on the bidding day.

What is still a sandbox

The rating, the debenture trustee, listing and disclosure stay. There is no separate tokenised exchange. The depository remains the authoritative record under the Depositories Act, 1996. The pilot sits in SEBI's regulatory sandbox for a period the release and the FAQs do not publish. That is a different clock from the three-year window on DTCC's tokenisation launch. South Korea has dated only stage one of its securities tokenisation. India has three prints and has not dated stage two. A Hana Bank digital bond has already settled T+0. SEBI's baseline is the two-to-three-day gap it wants to close.

A tokenised-deposit rail among Canada's largest banks has been reported without a named settlement asset. Demat 2.0 names one, the RBI's wholesale e₹, and the test runs only for institutions whose banks offer that wallet. Stage two is secondary trading and retail access. Stage three may extend nodes to credit rating agencies and depository participants, and may take in other instruments. SEBI sets no volume target and does not name the investors behind the 18, four and one allocations. The next issuer does not need a new custody stack. It needs a depository flag on an account the buyer already has, and a wholesale digital-rupee wallet at a participating bank.

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