On February 22, 2018, Union Finance Ministry announced that the first sale of electoral bonds will start from March 1, 2018 for a period of 10 days at select branches of State Bank of India (SBI).
The electoral bonds scheme was announced during the 2017-18 Union Budget speech of Finance Minister, Arun Jaitley.
- Broad contours of this scheme were notified in January 2018.
- This scheme will serve as an alternative to cash donations and is thereby an attempt to make political funding more transparent.
Electoral Bonds – Specifications:
The bonds will be available in multiples of Rs.1000, Rs. 10000, Rs. 10 lakh, Rs. 1 crore.
- These bonds would be valid for 15 days from the date of issue.
- Any citizen of India or an entity incorporated or established in India can purchase these bonds.
- However, at the time of purchasing the bonds, the donor will have to fulfil Know Your Customer (KYC) norms at the bank and will have to make payment from a bank account.
- The bonds will not carry his/her/entity’s name. Thus it will be a bearer instrument. Besides, it will be an interest-free banking instrument.
- Individuals can buy electoral bonds, either singly or jointly, with other individuals.
- Only registered political parties, which have secured not less than 1 per cent of the votes polled in the last election of the Lok Sabha or legislative assembly of the state, are eligible to receive donation through electoral bonds.
- Political parties that receive these bonds can encash it only through a designated bank account with Election Commission. The payee political party shall not receive the payment if the bond is deposited after expiry of the validity period of 15 days.
First Sale of Electoral Bonds:
Electoral Bonds can be purchased from four main branches of State Bank of India in Chennai, Kolkata, Mumbai and New Delhi, starting from March 1, 2018 for a period of 10 days.
- In context of this news, it is important to note that many States will be going to polls during 2018.
- Nagaland and Meghalaya will go for polls on February 27, 2018, followed by Karnataka in April-May 2018.
- Madhya Pradesh, Rajasthan, Chhattisgarh and Mizoram are the other states which will have state assembly elections in later half of 2018.