11th September 2026
By Anjali Kochhar
Larsen & Toubro (L&T) has raised ₹500 crore (roughly US$53m) through tokenised bonds, becoming the first private-sector corporate in India to complete a tokenised bond issuance. The three-year transaction was conducted under the Securities and Exchange Board of India’s (SEBI) newly introduced blockchain-based tokenisation framework, marking another major step in the digital transformation of India’s corporate debt market.
India’s Tokenised Bond Market Builds on REC’s First Pilot Issue
The development comes shortly after state-owned Rural Electrification Corporation (REC) completed India’s first pilot issuance of tokenised corporate bonds. REC raised ₹500 crore at a 7.30% annual coupon for a tenure of one year and nine months. Its issue received bids worth ₹796 crore, reflecting strong early interest in blockchain-based debt instruments.
L&T’s latest transaction builds on this emerging market infrastructure. Under SEBI’s framework, corporate bonds can be represented and managed digitally using Distributed Ledger Technology (DLT). While the underlying instrument remains a conventional debt security, key information related to ownership and transactions is recorded through blockchain-based infrastructure.
The use of DLT is expected to improve transparency and efficiency across the bond lifecycle. It can potentially reduce the number of intermediaries involved in maintaining and reconciling transaction records while allowing securities-related processes to be completed more efficiently.
How CBDC Settlement Works With Tokenised Bonds in India
A major feature of the new system is its integration with digital payment infrastructure. L&T’s tokenised bond transaction uses a Central Bank Digital Currency (CBDC) wallet for settlement of funds. The integration of tokenised securities with CBDC-based payments represents an important development in connecting India’s emerging digital financial infrastructure with traditional capital markets.
REC’s earlier transaction demonstrated some of the potential benefits of the model. Its tokenised bonds used the National Stock Exchange’s electronic bidding platform, while the securities were managed through blockchain-based infrastructure. The transaction enabled pay-in, allotment and listing to be completed on the same day, highlighting the possibility of faster settlement compared with conventional processes.
What Tokenised Bonds Could Mean for India’s Corporate Bond Market
Tokenisation could eventually have a broader impact on India’s corporate bond market. By creating a digital record of securities ownership and transactions, the technology could help reduce settlement risks, improve transparency and automate parts of the bond lifecycle. It may also support fractional ownership in the future, potentially making corporate debt accessible to a wider pool of investors.
However, tokenised bonds are still at an early stage in India. Market participants will need greater infrastructure, broader institutional participation and deeper secondary-market liquidity before the technology can achieve large-scale adoption. Current participation also depends on access to compatible digital securities and CBDC infrastructure.
L&T’s ₹500-crore issuance nevertheless represents a significant milestone. With both a major public-sector financial institution and one of India’s largest private-sector companies now using tokenised bonds, blockchain-based infrastructure is beginning to move from an experimental concept toward practical applications in the country’s debt markets.
The transaction could encourage other companies and financial institutions to explore tokenisation as India continues to modernise its capital-market infrastructure and integrate blockchain technology with regulated financial systems.
