Electoral Bond Scheme
- November 19, 2022
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Electoral Bond Scheme
Subject : Polity
Context : The Union Finance Ministry decided that it did not need the Election Commission’s concurrence for its November 7 amendment to the Electoral Bond Scheme that increased the period of sale of electoral bonds, documents show.
Concept :
- The amendment was notified while the Model Code of Conduct (MCC) was in place for the Himachal Pradesh and Gujarat elections.
- The proposal was first discussed and approved within the ministry in March 2021.
- However, it was only notified on November 7 this year, and the 23rd tranche of electoral bonds were sold from November 9 to November 15.
- Economic affairs secretary has said that as this matter was already duly noted by ECI (Election Commission of India) in 2021, another reference on the matter for ECI concurrence is not necessary.
About Electoral Bond Scheme
Introduced with the Finance Bill 2017, Electoral Bond is a financial instrument for making donations to political parties.
- These bonds are on the lines of bearer bonds or promissory notes wherein the issuer (bank) is the custodian and pays the one who holds the bonds (political party)
- The bonds are issued in multiples of Rs. 1,000, Rs. 10,000, Rs. 1 lakh, Rs. 10 lakh and Rs. 1 crore without any maximum limit.
- State Bank of India is authorized to issue and encash these bonds, which are valid for fifteen days from the date of issuance.
- These bonds are redeemable in the designated account of a registered political party.
- The bonds are available for purchase by any person (who is a citizen of India or incorporated or established in India)for a period of ten days each in the months of January, April, July and October as may be specified by the Central Government.
- A person being an individual can buy bonds, either singly or jointly with other individuals.
- Donor’s name is not mentioned on the bond.
- Only parties registered under the Representation of the People Act 1951 could receive donations through electoral bonds, and they also should not have secured less than 1% of the votes polled in the previous elections.