What is Electoral Bond Scheme?

Learn about the Electoral Bond Scheme in India, its advantages, case studies, and criticisms. Find out how this financial instrument aims to bring transparency to political funding.


Electoral bonds are a financial instrument that citizens or corporate houses can buy from authorized banks and donate to political parties. This scheme was introduced in India in 2018 by the government with the aim of bringing transparency in political funding.

How does it work?

Anyone can buy electoral bonds in multiples of INR 1,000, INR 10,000, INR 1 lakh, INR 10 lakh, and INR 1 crore from selected branches of SBI. These bonds are similar to promissory notes and can be donated to any eligible political party. The political party can encash these bonds through registered accounts within 15 days.


  • Transparency in political funding
  • Prevention of black money in politics
  • Encourages legitimate donations
  • Reduces cash donations

Case Studies

In the 2019 General Elections in India, electoral bonds worth INR 612 crore were sold, indicating a huge participation from both individuals and corporates in funding political parties through this scheme. This helped in reducing the dependence of political parties on anonymous donations.


However, the electoral bond scheme has also faced criticism from various quarters. Critics argue that it lacks transparency as the donor’s identity is not revealed. There are concerns about possible quid pro quo between donors and political parties.

Future Prospects

The Supreme Court of India has raised concerns about the electoral bond scheme and its impact on transparency in political funding. The government has defended the scheme, stating that it promotes clean money in politics. The future of the electoral bond scheme remains uncertain as it continues to be a topic of debate among policymakers and citizens.

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