In all democracies, political financing is a grim business, big or small, old or new. Unlawful under-the-table contributions aimed at buying influence or policy / regulatory favors have clouded all democracies, and India is no exception to this pattern. The National Democratic Alliance (NDA) government's recent addition of a new political financing scheme called Electoral Bonds (EB) in 2017 has aroused enormous public interest in its alleged role in promoting the grim trends in political financing. A series of recent Right to Information (RTI) activist Lokesh Batra revealed to the public how and methods the day's government ignored the warnings and reasoned voices of key independent institutions such as the Indian Reserve Bank and the Election Commission to push the law into effect. In addition to bending the business rules at will to facilitate easy donation flow, every effort has been made to keep this new scheme opaque and out of reach of the public.

What's the electoral bond? In the manner of a promissory note, an electoral bond is a bearer instrument. It is an interest-free banking instrument by which an individual or business person in India is eligible to purchase the bond from different branches of the State Bank of India for 10 days each in the months of January, April, July, and October (either through cheque or electronic payments). According to the business rules unveiled by the government in 2018, a person who is an Indian citizen or incorporated or founded in India may purchase EB. Besides, an individual can purchase election bonds, either individually or in conjunction with other individuals. Only political parties registered under Section 29A of the 1951 Representation of the People Act which received not less than 1% of the votes cast at the last general election to the People's House or the State Legislative Assembly are eligible for such donations.

Some benefits of EB are that the bonds will only be valid for 15 days and not bear the name of the lender, although the payee will have to comply with the bank's KYC (Know Your Customer) requirements. What is relevant here is that in case of donations received through electoral bonds, no report is needed to be submitted by receiving parties. In other words, to disclose the specifics of contributions, neither donors nor political parties are legally bound. Opacity is thus present in this new policy financing instrument.