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Informist, Tuesday, May 26, 2026

 

--SEBI chair: Growing economy needs patient debt capital 

--CONTEXT: SEBI Chairman Tuhin Kanta Pandey's comments at an event in Mumbai 

--SEBI chair: Corporate bonds can offer diversification, but not risk-free 

--SEBI chair: Need more issuers to see corp bonds as regular capital source 

--SEBI chair: Regulation cannot be static, must evolve with risks 

--SEBI chair: Working to develop ETFs on bonds 

--SEBI chair: SEBI, stock exchanges to hold bond issuer outreach programmes 

--SEBI chair: Bonds will draw retail investors only if they understand pdts 

--SEBI chair: Exploring pilot on tokenisation of corp bonds 

 

MUMBAI – The Securities and Exchange Board of India is planning to begin a pilot project for tokenisation of corporate bonds to help improve liquidity in the market, Chairman Tuhin Kanta Pandey said at an event organised by CareEdge Ratings in Mumbai. The project will involve various market participants and could be rolled out in six-nine months.

 

"The pilot will test if tokenisation can deliver faster settlement, better traceability, automated servicing, and greater transparency," Pandey said. "We are going to see whether we can make corporate bonds feasible on the tokenisation basis on a DLT (digital ledger technology)."

 

SEBI is also working to develop exchange-traded funds and derivatives for corporate bond indices. "These can improve liquidity, allow retail investors to access debt markets with smaller ticket sizes, and help institutions hedge interest rate risks," Pandey said.

 

Pandey acknowledged that the participation of retail investors in the corporate bond market would not improve merely because of a higher number of products. For participation of retail investors to improve, bonds should be easier to understand, he said. Corporate bonds provide an opportunity to diversify portfolios, but this is not risk-free, he said.

 

To bring more investors into the corporate bond market, SEBI is planning awareness campaigns across India. SEBI will also conduct outreach programmes to bring more issuers into the corporate bond market. "We need more issuers to see the debt market as a regular source of capital," Pandey said.

 

He iterated the need to deepen the corporate bond market, which needs more issuers, different kinds of investors, and better liquidity. "A buy-and-hold investor base provides stability. But when bonds rarely trade, volumes stay thin, price discovery weakens, exits become difficult, and new investors hesitate," he said.

 

Pandey also pointed to the importance of the debt market and the need to increase investor participation. "A growing economy needs patient debt capital for infrastructure, for capacity expansion, refinancing and long gestation projects...That's why the corporate debt market is central to India's journey of sustained economic growth." he said. "It reduces over-reliance on banks."  End

 

Reported by Anshul Choudhary, Navya Shruti, and Cassandra Carvalho

Edited by Avishek Dutta

 

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