Electoral Bonds
An electoral bond is like a promissory note that can be bought by any Indian citizen or company incorporated in India and can donate the same to any eligible political party of his/her choice.
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The electoral bonds were introduced with the Finance Bill (2017) and the Electoral Bond Scheme was notified in 2018.
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These are issued only by State Bank of India via select branches and are issued in multiples of Rs 1,000, Rs 10,000, Rs 100,000 and Rs 1 crore.
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These are available for purchase for 10 days at the beginning of every quarter i.e. first 10 days of January, April, July and October as specified by the government.
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Any party that is registered under section 29A of the Representation of the Peoples Act, 1951 and has secured at least one per cent of the votes polled in the most recent General elections or Assembly elections is eligible to receive electoral bonds.
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The party will be allotted a verified account by the Election Commission of India (ECI) and the electoral bond transactions can be made only through this account.
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The electoral bonds will not bear the name of the donor and these donations would be tax-deductible.
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The amendment in the Finance Bill (2017) allowed even foreign company registered in India to make contributions to any political party under the Companies Act without any limits on the donation amount and without having to inform anyone of the contribution.