Use of blockchain for security and covenant monitoring becomes operational

To begin with, movable assets such as furniture, equipment, inventory and current assets such as portfolio of advances and receivables will be tracked at portfolio level, Sebi says

The use of distributed ledger technology (DLT) or blockchain has become operational for security and covenant monitoring in the area of debenture issuance. Market regulator Sebi on Monday issued operational guidelines in this regard. “With effect from April 01, 2022, the recording of asset details (and their verification), allotment, listing and payment of interestor redemption shall  be  available  in  the DLT system,” Sebi said in a press release.

The move is expected to enhance transparency and efficiency when creation and monitoring of covenants of non-convertible securities.

To begin with, movable assets such as furniture, equipment, inventory and current assets such as portfolio