The concept of electoral bond was introduced in the Budget of 2017-18 for political funding. Electoral Bond is a bearer Banking Instrument to be used for funding eligible Political Parties.

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Features of Electoral Bond:

• Electoral Bonds may be purchased by a person, who is a citizen of India or incorporated or established in India. A person being an individual can buy Electoral Bonds, either singly or jointly with other individuals.
• The purchaser would be allowed to buy Electoral Bonds only on fulfillment of all KYC norms and by making payment from a bank account. It will not carry the name of payee.
• Only the Political Parties registered under Representation of the People Act, 1951 and which secured not less than 1% of the votes polled in the last General or State Election, will be eligible for such donations.
• The Electoral Bond(s) shall be cashed by an eligible political party only through a designated bank account with the authorized bank.
• Bond(s) would be issued/purchased for any value, in multiples of Rs.1,000, Rs.10,000, Rs.1,00,000, Rs.10,00,000 and Rs.1,00,00,000 from the Specified Branches of the State Bank of India (SBI). Electoral Bonds shall be valid for fifteen days from the date of issue.

Criticism of Electoral bonds

Security threats:

• The Election Commission cannot monitor the funding through Electoral Bonds as there is secrecy of donor, therefore it becomes difficult to know what is coming in is black money or not.
• Electoral Bonds can be misused for routing foreign money and thereby increase ability of other countries to influence Indian elections.

Corporate sponsorship without oversight:

• Anonymity promotes unnecessary secrecy in corporate funding whereby the shareholders of a corporation be unaware of the company’s contributions.
• The programme removes an existing condition that had prohibited companies from donating anything more than 7.5% of their average net-profit over the previous three years. This now means that even loss-making entities can make unlimited contributions.
• The requirement that a corporation ought to have been in existence for at least three years before it could make donations — a system that was meant to stop shell concerns from being created with a view to syphoning money into politics — has also been removed.
• Electoral Bonds can be misused to bribe the Government of the day, to induce policies that will help the company in its business.

Voters’ right to know is silenced

• Voters will have no idea of how, and through whom, a political party has been funded and for free and fair elections, voters require free and complete access to information about the parties for which they were going to vote.

Conclusion

• Electoral Bonds has been criticised that they violate an essential condition of political equality.
• Whereby, the absence of complete knowledge about the identities of those funding the various different parties is against the voters’ right to informed decision.
• It can be concluded that Electoral Bonds’ Scheme prioritizes the donor over a voter.