Electoral bonds: More than 91% donations over Rs 1 crore each

News: According to RTI documents, electoral bonds with denomination of Rs 1 crore accounted for more than 91% of the Rs 5,896 crore raised  between March 1, 2018 and July 24, 2019.

Facts:

About Electoral Bond Scheme

• It is a non-interest bearing financial instrument which can be used by people/company incorporated in India for funding eligible political parties. The government had notified the Electoral Bond Scheme in 2018.
• Aim: To ensure transparency in political parties.
•  Eligibility of Political Parties: Only those political parties who are registered under Section 29A of the Representation of the People Act, 1951 and has secured no less than 1% votes in the last Lok Sabha elections or the State Legislative Assembly are eligible to receive electoral bonds.
• Eligibility of Donors: Electoral bonds may be purchased by a citizen of India or entities incorporated or established in India.

Functioning of the Scheme:

• The electoral accounts are issued by the State Bank of India (SBI). The electoral bonds can be purchased in the months of January, April, July and October.
• Political parties are allotted a verified account by the Election Commission and all the electoral bond transactions are done through this account only.
• The donors can buy electoral bonds and transfer them into the accounts of the political parties as a donation. The electoral bonds are available in denominations from Rs 1,000 to Rs 1 crore. The name of the donor is kept confidential.
• The bonds remain valid for 15 days. They can be encashed by an eligible political party only through a bank account with the authorised bank within that period only