Union Finance Minister Arun Jaitley on Tuesday outlined the basic contours of the electoral bonds scheme announced during the 2017 Budget, including their denominations, validity, and eligibility of the purchasers.
- “Electoral bonds would be a bearer instrument in the nature of a promissory note and an interest-free banking instrument,” the Minister said in the Lok Sabha.
- “A citizen of India or a body incorporated in India will be eligible to purchase the bond.”
- Electoral bonds can be purchased for any value in multiples of ₹1,000, ₹10,000, ₹10 lakh, and ₹1 crore from any of the specified branches of the State Bank of India.
- “The purchaser will be allowed to buy electoral bonds only on due fulfilment of all the extant KYC norms and by making payment from a bank account.
- “It will not carry the name of the payee.”
- The bonds, aimed at increasing transparency in political funding, will have a life of 15 days during which they can be used to make donations to registered political parties that have secured not less than 1% of the votes polled in the last election to the Lok Sabha or Assembly.
- The bonds shall be available for purchase for a period of 10 days each in the months of January, April, July and October, with an additional 30 days to be specified by the Central government in the year of a general election.
- “The bond shall be encashed by an eligible political party only through a designated bank account with the authorised bank.
- The aim was to bring transparency in funding of political parties and elections.
- The political funding mechanism developed over the last 70 years has faced widespread criticism as people do not get clear details about how much money comes, from where it comes and where it is spent.
- Electoral bonds, can be given to a registered political party, which has secured at least 1% vote in last election.
- That party will have to give a bank account to the Election Commission and it will have to be encashed within 15 days,
- Only political parties which has secured not less than 1% of the votes polled in the last general election or an Assembly poll would be eligible to receive donations through electoral bonds.