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Electoral bonds for political funding
January 8 , 2018
2545 days
1524
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- The Union Govt. unveiled the contours of the ‘Electoral Bonds’ scheme.
- Electoral bonds are announced in last year General Budget with the aim to curb the Money laundering, irregularities and bringing more transparency in the process of Political Funding Process.
- Electoral bonds will be issued by a notified bank for specified denominations, which is interest free and which is an intermediate financial instrument between donor and Receptor (Political Party).
- Only Up to Rs. 2000 donor can make the funding in cash. Beyond the denomination it should be in the form of Bond.
- As per this, now a citizen of India or a body incorporated in India will be eligible to purchase the bond from specified branches of the State Bank of India.
- The bonds can be purchased for any value in multiples of ₹1,000; ₹10,000; ₹1 lakh; ₹10 lakh; and ₹1 crore.
- Those who want to donate to a political party, can buy these bonds by making payments digitally, or through cheque or cash.
- Then they are free to gift the bond to any registered political party.
- The bonds will likely be bearer bonds and the identity of the donor will not be known to the receiver.
- The party can convert these bonds back into money via their bank accounts within 15 days.
- The bank account used must be the one notified to the Election Commission.
- Electoral bonds are essentially like bearer cheques, the issuing bank will remain the custodian of the donor’s funds until the political party redeems the bond.
- To benefit from the electoral bonds scheme, the political parties
- Must have been registered with the Election Commission and
- Should have secured not less than 1 per cent of the votes polled in the most recent General Election to the Lok Sabha or a State legislative assembly.
- Electoral bonds under the scheme will be available for purchase for a period of ten days each in the months of January, April, July and October. An additional period of 30 days would be specified by the Centre in the year of general elections.
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