Electoral Bonds: SBI fast running out of excuses

The State Bank of India has as many as 28 thousand branches in India but only 29 of them, one in each state, were authorised to sell electoral bonds. Transparency activist Commodore Lokesh Batra, who has relentlessly questioned the scheme and regularly elicited information from the SBI informed on Thursday, 7 March that only 19 of the 29 authorised branches actually sold the bonds and they were encashed in just 14 branches of the SBI.

The information would further embarrass the largest PSU bank in the country, which has informed the Supreme Court of its inability to share the information with the Election Commission of India by Wednesday, 6 March as directed by the court. In its somewhat convoluted explanation, SBI claimed that it would take more time to ‘match’ the data of the buyers and the political parties, details of which were preserved in two silos etc.

But who asked the SBI to match the data, wondered former finance secretary Subhash Garg, who told Barkha Dutt’s Mojo Story that it was the lamest of excuses. Garg, who was in the saddle in the finance ministry had steered the scheme under Arun Jaitley, is an insider and would know how the scheme worked. The Supreme Court of India’s order made it clear that it only wanted the SBI to share the names of the buyers and the beneficiaries, with details of the amount and the dates of encashment. “It should not take SBI more than 10 minutes to format and part with the data,” he claimed.

What is more, the SBI maintained an audit trail of the bonds being sold and redeemed by political parties. The trail was maintained using the serial number on each bond. Both RBI and SBI had insisted upon a serial number when the union government launched the scheme in 2018.

The affidavit by the SBI has prompted sceptics to ask who the SBI is trying to protect. Only 22,217 bonds were sold since 2018, most of them in Rupees one crore denominations. Each bond is numbered and the SBI checked the KYC (Know Your Customer) details of the buyers before selling them. When the bonds were presented by the political parties (only 25 of them were eligible to receive the bonds and had opened special accounts for the purpose), the SBI verified and tallied the number on the bond and the date to check if they were bought within the last 15 days, the window allowed for encashment. How can the SBI then claim it is a complex process and would take four months till the end of June to part with the information?

Commodore Batra (Rtd) indeed has been receiving under the RTI (Right to Information) information about the bonds sold in each phase, the denominations that ranged from Rs 1,000 to Rs 1,0000000, and the branches which sold them. The information was provided to him for each of the 30 windows opened by the government for SBI to sell the bonds. The information which was not shared were the identity of the buyers.

A report by Nitin Sethi and Tapasya for the Reporters’ Collective on Thursday also demonstrated that the SBI had diligently shared the details with the finance ministry at the end of each cycle, in fact within 48 hours of the window closing, the report cited documents and correspondence to show. It is not known if the SBI shared the names of the buyers also with the ministry, formally or informally.

The Reporters’ Collective report cites an instance from 2018 when a political party presented 10 bonds of Rupees one crore each for encashment after the expiry of the 15-day window for it. The SBI, records show, sought advice from the finance ministry, which was quick to tell SBI to honour the expired bonds. Within 48 hours, the bonds were redeemed, the report suggests.

Another important point raised in the report by the Collective is the finance ministry’s own admission that the details could be retrieved and shared at any time with investigative agencies, if required. “The records of the purchaser are always available in the banking channel and may be retrieved as and when required by enforcement agencies,” reads one of the several notings from the ministry collected by Commodore Batra under the RTI.

Another transparency activist Anjali Bharadwaj cited SBI’s affidavit to point out that the State bank of India has itself admitted that the details in sealed cover were sent to the SBI Head Office on a daily basis. If the SBI HO in Mumbai has the sealed covers, why would it take the bank four months even if it were to manually match the details of buyers and beneficiaries, she wondered.