State Bank issues Electoral Bonds worth Rs 2,772 crorehttps://indianexpress.com/article/business/banking-and-finance/state-bank-issues-electoral-bonds-worth-rs-2772-crore-lok-sabha-polls-5689257/

State Bank issues Electoral Bonds worth Rs 2,772 crore

Out of 2,742 bonds which were issued during the 15-day period, 1,264 bonds were valued at Rs 1 crore and above, SBI — the country’s largest public sector bank — said.

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Electoral Bonds are valid for 15 days from the date of issue. This means a bond issued on March 1, 2019, will be valid up to March 15, 2019.

State Bank of India — the only bank authorised to issue and encash Electoral Bonds by the government — has issued bonds worth Rs 2,772.78 crore for funding political parties, since the scheme was launched on March 1 last year.

Almost half of the amount came in March this year when SBI issued Electoral Bonds worth Rs 1,365.69 during the sale window of March 1-15 this year, the bank said in its reply to the Right to Information application filed by The Indian Express.

Out of 2,742 bonds which were issued during the 15-day period, 1,264 bonds were valued at Rs 1 crore and above, SBI — the country’s largest public sector bank — said.

While the government implemented the Electoral Bond scheme as an alternative to cash donations made to political parties as part of its efforts to bring transparency in political funding, the Supreme Court had earlier this month directed all political parties to submit details of political funding received so far to the Election Commission of India in “sealed covers” by May 30.

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The apex court was hearing a plea by NGO Association of Democratic Reforms (ADR) challenging the scheme and seeking either a stay on the bonds or the declaration of names of the donor to ensure transparency in the poll process.

The apex court bench, headed by Chief Justice Ranjan Gogoi and comprising Justices Deepak Gupta and Sanjiv Khanna, ordered the parties to furnish receipts of electoral bonds to the Election Commission providing information on the identity of donors and the amount in the account of donors.

The court also directed the Finance Ministry to reduce the window of purchasing electoral bonds from 10 days to five days in April and May.

During the sales window of January 1-10 this year, 937 bonds worth Rs 350.36 crore issued. During the period October 1-10, 2018, SBI sold 733 bonds valued at Rs 401.73 crore ahead of the state elections in Madhya Pradesh, Rajasthan, Chhattisgarh and Telengana.

The Mumbai main branch of SBI issued Electoral Bonds worth Rs 471.30 crore, followed by Rs 179.92 crore in Delhi and Rs 176.92 crore in Kolkata during the period of March 1-15 this year.

Electoral Bonds are valid for 15 days from the date of issue. This means a bond issued on March 1, 2019, will be valid up to March 15, 2019.

The bonds can be redeemed only by an eligible political party by depositing the same in its designated bank account maintained with an authorised bank.

The bonds are issued in the denomination of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh and Rs 1 crore.

The extant instructions issued by the Reserve Bank of India regarding ‘know your customer’ (KYC) norms of a bank’s customer will apply for all applicants of the electoral bonds.

“However, SBI as authorised bank may call for any additional KYC documents, if it deems necessary,” SBI has said.

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Only political parties registered under Section 29A of the Representation of the People Act, 1951 (43 of 1951) and secured not less than one per cent of the votes polled in the last General Election to the House of the People or the Legislative Assembly are eligible to open current account for redemption of Electoral Bonds.