Recently, the Union Government took no approval from RBI, and only informed the Election Commission of India, before amending the electoral bond scheme as per an RTI reply.
About:
Electoral Bonds:
Electoral bonds are interest-free bearer instruments used to donate money anonymously to political parties.
These bonds are sold in multiples of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh, and Rs 1 crore.
Donors can purchase and subsequently donate the bonds to their party of choice, which the party can then cash through its verified account within 15 days.
The State Bank of India (SBI) is the only bank authorized to sell them.
There is no limit on the number of bonds an individual or company can purchase.
These Bonds can be purchased by a person who is a citizen of India or incorporated or established in India.
Concerns:
Infringes the citizens ‘Right to Know.
Foreign Funding: Due to the anonymous nature of electoral Bonds, political parties could get unchecked foreign funding.
Way Forward:
Bringing transparency in the funding of political parties is the first step in the direction of electoral reforms by disclosing the identity of donors to political parties.
State funding of elections could be another option for bringing transparency to the electoral process.