How do you buy a bond in India?

16 doors to buy a bond

On 1st May 2024 a reader asked TradingQnA a question that 24,320 people have since opened:

Question is from where can i invest in corporate bonds? [...] is it reputed & big enough customer base that it will not vanish one day? [...] RBI Retail Direct app i have also heard Does kite provide to buy corporate bonds?

pyarlath, TradingQnA, 1st May 2024

He names 3 ways to buy a bond in one post: a bond app, the RBI's own app and his stock broker. There are 6 in all. Each sells different bonds, starts at a different order size, and settles in its own way.

Every purchase follows the same path. First you decide which bond you want, and that picks the door. Then you go through the door and pay. A day or so later the bond lands in a register in your name. One day you may want to sell it. The chapter walks that path in order: section 2 helps you pick, sections 3 to 8 take one door each, sections 9 and 10 follow the bond into your name, and sections 11 and 12 are about selling.

There are 6 doors to buy a bond in India. Which one to use depends on the bond you want and how much you want to put in.

So the first step is to know which bond you want.

2Which bond do you want?

2 questions pick the door for you. Is it a government bond or a company bond? And is it new, being sold for the first time, or does it already trade?

The doors below follow the same order: bonds that already trade, then new company bonds, then new government bonds.

Decide the bond first. Government or company, new or already trading: those 2 answers pick the door.

Most readers already have the first door on their phone.

3Door 1: the stock exchange, through your broker

What it sells. Bonds that already exist and are listed: government bonds, Treasury bills, state loans, Sovereign Gold Bonds and company bonds. They trade in the cash segment of NSE and BSE, the same part of the exchange where shares trade. This door has been open to individuals since 16th Jan 2003, when the Finance Minister placed the first order for 10 government bonds himself.

How you buy. Search the bond's name or ISIN in your broker's app and place an order as you would for a share. Use a limit order, a price you set, and turn that price into a yield first (chapter 3). The price on the exchange screen already includes accrued interest (chapter 4).

Smallest order. 1 unit. Each bond's face value decides what that costs: ₹100 for a government bond, often ₹1,000 or more for a company bond.

What you pay. The price, your broker's brokerage, exchange charges, and a stamp duty of 0.0001% of the value on company bonds. There is no stamp duty on government bonds. Every trade comes with a contract note, the broker's bill listing each of these.

When it is yours, and where. T+1, the working day after you trade, in your demat account, the same one that holds your shares.

Where to start. On Zerodha, bonds are bought in Kite like shares: see how to buy debentures and bonds on Kite. NSE lists the bonds that trade on its cash segment on its bonds traded in the capital market page.

Some tools sit on top of this door. One is the bond project, which publishes this module. It lists the exchange's bonds at the prices they actually trade and sends your order through your own Zerodha account, so the bond still settles into your demat. Consider this 1 of exactly 2 plugs in the entire module; the other sits at the very start. Mera bas chalta toh sab jagah plug karta, but compliance is important.

Track recordOpen 23 years, since 2003. It works, but it is thin. It uses the demat account and broker app most investors already have, and it is the only door where you can both buy and sell any listed bond. Sellers are the problem. On 25th Sep 2026 the order books of the 2 exchanges recorded 2,302 company bond trades worth ₹23 crore in all, about ₹1 lakh each. Most bonds are owned by institutions that trade somewhere else (section 11), so a bond can go days without anyone offering to sell it.

TrapThe last traded price may be weeks old, and the lowest offer to sell can sit far above it. Easy to buy here is not the same as easy to sell (chapter 8).

The exchange door sells listed bonds like shares, from 1 unit, settling into demat the next working day.

The exchange is not the only shop for bonds that already trade. A newer kind of shop sells the same bonds through its own app.

4Door 2: bond apps

What they are. Websites and apps that sell listed bonds to retail investors. On 14th Nov 2022 SEBI wrote that their "operations were outside SEBI's regulatory purview". Since then each must register with SEBI as a stock broker in the debt segment; SEBI calls them online bond platform providers, or OBPPs. By October 2026, 57 had been switched on at NSE or BSE.

How you buy. You pick a bond on the app. The app sends your order to an exchange's request for quote screen, or RFQ, where a price is offered and accepted between 2 parties rather than matched in a public order book. The trade settles through a clearing corporation into your own demat account.

Institutions such as banks, mutual funds and insurers trade on the same RFQ screens directly, in much bigger sizes. This chapter is about retail investors, so it leaves that side out.

Smallest order. 1 unit of the bond's face value. Company bonds placed privately from 1st Jan 2023 carry ₹1 lakh, and from 3rd Jul 2024 a company may use ₹10,000 if it appoints a merchant banker and the bond is a plain one. Older bonds keep their old face value, so 1 unit can cost anything from ₹1,000 to ₹10 lakh.

What you pay. The price on the app, which includes whatever the app earns; SEBI does not make apps show their own margin. SEBI does require every app to show 13 facts about each bond, including the clean price, the dirty price and the yield:

Figure 1

When it is yours, and where. The same day or the next (T+0 or T+1), in your demat account.

Where to start. Before using any app, check it is on SEBI's list of online bond platform providers. NSE's RFQ FAQ explains the screen behind them.

Track recordAbout 4 years under SEBI's rules, since Nov 2022. The fastest growing door. 57 apps had been switched on by October 2026, and trades on the RFQ screens rose from 2.76 lakh in 2024-25 to 17.84 lakh in 2025-26, a jump SEBI put down mainly to retail investors buying through the apps. An app shows a shelf of bonds with a yield beside each one, and since 2024 companies can issue bonds in ₹10,000 pieces that fit a retail purchase. The open question is price. Apps do not have to show their own margin, and SEBI's consultation paper of 21st Aug 2026 looked at what apps earn on the bonds they sell.

TrapThe yield on the app is the app's own calculation on the app's own price. Before you buy, compare the dirty price of the same bond, by its ISIN, on the exchange.

Bond apps are SEBI registered brokers that route every order through an exchange and settle into your demat. The price is still yours to check.

The exchange and the apps sell bonds that already exist. A company selling a new bond for the first time does it through a public issue.

5Door 3: a public issue

What it sells. New company bonds, called non-convertible debentures or NCDs, on the days a company offers them to the public.

How you buy. Like a share IPO. Through ASBA, your bank blocks the money in your own account until bonds are allotted; below ₹5 lakh you can approve the block with a UPI mandate on your phone. Most brokers' apps and net banking offer it.

Smallest order. Each bond usually has a face value of ₹1,000. Most issues ask for at least ₹10,000, which is 10 bonds, and then let you add 1 bond, ₹1,000, at a time. The exact minimum is in each issue's offer document.

When it is yours, and where. Since 1st Nov 2025: if the issue closes on day T, bonds are allotted on T+1, credited to your demat on T+2, and trade on the exchange from T+3. Allotment is first come first served by the day you applied, until the issue is oversubscribed.

How big it is. Small. In 2025-26 companies raised ₹11,342.77 crore through public issues and ₹8,99,735.57 crore privately from institutions. Public issues were about 1.2% of the total.

Where to start. NSE's current and upcoming issues page lists debt issues alongside share IPOs, and BSE's public issues page does the same for issues open on BSE. SEBI publishes past public issue data.

Track recordDecades old. It works for the companies that use it, but it is a sliver. Every year from 2020-21 to 2025-26, public issues were between 0.82% and 2.24% of company borrowing. A public issue needs a full offer document, advertising and several days of collecting applications from thousands of people. A large company can raise the same money in a few days by placing bonds privately with a handful of institutions, so most never come to the public.

TrapThe coupon in the advert belongs to the issue. Once listed, the bond trades on door 1, often thinly. Chapter 10 shows how to read the offer document first.

A public issue is the only way to buy a company bond on its first day, and it is a small slice of company borrowing.

A new government bond is never sold that way. The RBI sells it at an auction, and your broker can take you there.

6Door 4: RBI auctions, through your broker or NSE goBID

What it sells. New central government bonds, Treasury bills and state loans, on the day the RBI auctions them. Chapter 6 explained how a retail investor bids without naming a price and pays the average accepted price.

How you buy. Since 23rd Nov 2017, stock exchanges collect retail bids and send the RBI one combined bid. You place yours through your broker's auction screen, or on the exchanges' own websites: NSE's goBID web portal or BSE Direct. On Zerodha it is the government securities section of Kite.

Smallest order. ₹10,000 of face value, in steps of ₹10,000, up to ₹2 crore per bond per auction.

What you pay. When you bid, the price is not known yet, so more money is blocked than the bond will cost. After the auction you pay the average price plus accrued interest, and the rest comes back to your broker account. Picture a hotel that blocks more than the room rate at check in and releases the rest when you leave. Few hotels work that way today, but the idea is the same.

When it is yours, and where. After the auction settles, in your demat account.

Track recordOpen almost 9 years through the exchanges, since 2017. It works, but few use it. Bids go in and bonds arrive as promised. The demand is what is missing. At the RBI's auction of 25th Sep 2026, ₹1,700 crore of the 6.94% GS 2036 was set aside for non-competitive bidders. 7 bids came in, for ₹84 crore, less than 5% of what was on offer. A bidder has to watch the auction calendar, bid inside a short window and leave money blocked until the result. NSE switched off its goBID mobile app on 30th Jul 2025; only the web portal remains.

TrapThe amount blocked is not the price. Read the debit only after the auction result.

Your broker's auction screen lets you buy a new government bond at the RBI's average price, from ₹10,000, into demat.

You can also skip the broker and go to the RBI itself.

7Door 5: RBI Retail Direct

What it is. An account with the RBI itself, launched on 12th Nov 2021. You open it online with your PAN, KYC details and a savings bank account. There is no fee to open, keep or bid through it; only the payment gateway may charge.

What it sells. New government bonds, Treasury bills and state loans at RBI auctions, the RBI's Floating Rate Savings Bond, and existing government bonds on a trading screen inside the portal. That screen is a side room of NDS-OM, the RBI's trading system for banks, where the big bond dealers are required to answer retail buyers and sellers. It does not sell company bonds.

Smallest order. ₹10,000 of face value.

What you pay. At auctions, the same as door 4: a block with a refundable cushion, which the RBI calls "not a fee", then the average price plus accrued interest. The refund reaches your bank account within 2 business days.

When it is yours, and where. Usually about 1 working day after the auction, in your Retail Direct Gilt account, or RDG account, which the RBI keeps for you in its own books.

Where to start. rbiretaildirect.org.in, and the RBI's Retail Direct FAQ.

Track recordOpen almost 5 years, since 2021. It works and is growing, but it is still small. By 5th Oct 2026 it had 3,91,882 accounts, and fewer than half of all applications ever started had become one. Accounts held ₹4,519 crore, and ₹2,629 crore of that was the Floating Rate Savings Bond, which cannot be sold. The trading screen sat almost idle for 3 years: ₹1,882 crore changed hands in total up to 31st Mar 2025, then ₹6,667 crore in 2025-26 alone. The account is free and the bonds come straight from the RBI. It stays small because it is a second account, apart from the demat where retail money already sits, its bonds cannot back trading margin, and it sells only government bonds.

TrapA bond in your RDG account cannot be pledged to your broker as trading margin (chapter 10). If you want that, the bond needs to be in demat.

RBI Retail Direct is a free account with the RBI for government bonds only, from ₹10,000, held in the RBI's own books.

The last door needs no app at all. It is the oldest and the simplest, and it sells only one bond.

8Door 6: a bank branch

What it sells. Only the RBI's Floating Rate Savings Bond, which opened on 1st Jul 2020 and which chapter 6 described: a 7 year bond paying the NSC rate plus 0.35%, reset every 6 months.

How you buy. At a branch of an agency bank, or on RBI Retail Direct. From ₹1,000.

Where it is held. In an account with the bank or the RBI, not in demat. It cannot be sold to anyone else.

Track recordBank branches have sold an RBI savings bond almost without a break since 21st Apr 2003; this one for 6 years, since 2020. It works, quietly. In 2025-26 it raised ₹12,476 crore, and only ₹1,067 crore of that came through Retail Direct, so about 91% came over bank counters. The rate follows a formula, there is no market price to watch, and it is sold at a branch people already visit. The cost is a 7 year lock, with early exit only for senior citizens, and no way to sell. Its 2 predecessors were closed to new money with 1 day's notice, on 2nd Jan 2018 and 28th May 2020, so the door stays open only as long as the government wants it to.

A bank branch sells one government bond, the floating rate savings bond, from ₹1,000, and it cannot be resold.

Those are the 6 doors. You have picked a bond, gone through a door and paid. The order screen says done, but the bond is not yours yet.

9When it becomes yours

Settlement is the moment the bond reaches your register and the money leaves your account. Since July 1995 the 2 have moved together for government bonds, through a clearing corporation that stands in the middle of every trade. Most doors now settle on T+1, meaning the working day after the trade date, T.

The clock matters most near a coupon. A coupon goes to whoever is on the register on the record date, so the day the bond becomes yours, not the day you ordered it, decides who is paid.

On the same day as the first question, another reader asked who gets the coupon if you buy a government bond 1 day before it is paid. Then he tried it:

The settlement is T+1 but what you state doesn't appear to be true. I did a small experiment of buying 1 unit a day before coupon payment date. Bought on 29th Apr with coupon date as 30th April and didn't receive the coupon payout.

mukulgupta21, TradingQnA, 4th May 2024

He bought on door 1. On a T+1 clock the bond reached his demat on 30th Apr, the payment day itself. For a government bond, the coupon goes to whoever is on the register 1 day before it is paid (chapter 4). On that day the bond was still in the seller's name, so the seller was paid.

The day you buy is not the day you own. Check the settlement date on every order.

When the clock runs out, the bond lands in a register in your name.

10Where your bond is held

Whichever door you used, the bond ends up in a register with your name on it. There are 2 such registers for a retail investor.

• A demat account. The electronic account that also holds your shares. It sits at a depository, NSDL or CDSL, the 2 companies that keep the official record of who owns which share or bond. You reach it through a depository participant, usually your stock broker or bank.
• A Retail Direct Gilt account, or RDG account. An account the RBI opens for individuals in its own books, for government bonds only.

India built these registers after it learned what happens without one. In 1992, banks traded government bonds using paper receipts that sometimes had no bond behind them, and about ₹3,543 crore could not be accounted for. On 25th May 1992, 3 members of the committee investigating it visited the RBI's own register of government bonds:

Figure 2

The fix took a few years. NSDL opened in November 1996 and CDSL in March 1999. Today you can see your own account any day.

Both depositories send a consolidated account statement, or CAS, listing everything in your name across both of them. You can request it any time from NSDL or CDSL. A government bond in an RDG account shows on the Retail Direct portal instead. Since 7th Nov 2025 a government bond can move between your own demat and RDG accounts; CDSL calls it an "RDG Transfer". Not every depository participant offers the RDG to demat direction yet, so ask yours.

So, to pyarlath's worry about an app vanishing: a company bond bought on the exchange, on a bond app or in a public issue lands in your demat account, at the depository, in your name. The app does not hold it. If the app closes, the bond is still in your CAS.

TrapAn order screen or a confirmation email is not ownership. After every purchase, find the bond in your CAS or on the Retail Direct portal. If it is not there, you do not own it yet.

Every door lands your bond in a register in your name: demat at NSDL or CDSL, or an RDG account at the RBI. Check it after every purchase.

Buying is the easy half. One day you may want your money back before the bond ends, and for that you need a buyer.

11When you want to sell

To sell a bond, you need someone who wants that bond on the same day. Most bond buyers are institutions, and they trade in a room none of the 6 doors leads to.

Retail investors and institutions have never been allowed to trade bonds on the same platform without hurdles. When NSE opened its first bond trading screen on 30th Jun 1994, it was for banks and institutions. The RBI's NDS-OM, launched on 1st Aug 2005, trades in lots of ₹5 crore and is open only to those with accounts in the RBI's register. Retail Direct gave individuals a way onto it in 2021, but only into side rooms for small trades and quotes. Since 2025 brokers may connect clients to it as well, through a separate unit outside SEBI's usual complaint route.

Company bonds show the split in numbers. On Friday 25th Sep 2026, institutions dealt ₹7,403 crore of company bonds with each other and reported the deals to the exchanges. The exchange order books that retail investors use traded ₹23 crore.

Retail money also sits in the wrong place for bonds. Most of it is in demat accounts built for shares. On 31st Aug 2026 NSDL had 4,67,00,882 active accounts, and only 6,08,666 of them, 1.30%, held any bond or other debt. Bonds are tied to the share world: they sit in the same demat account, and government bonds can be pledged as cash margin for share and derivative trading (chapter 10). But most bond trading happens between institutions, where that money does not reach.

Retail investors and institutions buy bonds through different doors and rarely meet. Retail money sits where shares trade; bonds mostly trade somewhere else.

126 doors, one thin market

Every door walks the same path: a bond, a door, a clock, a register. What changes from door to door is the clock, the register and who answers if something goes wrong. Here are all 6 doors on one card:

Each door was added for a good reason. Together they split the same bonds across different screens, different registers and different hours, and institutions trade in a separate market again. When you want to buy, any one door will do. When you want to sell, you need a buyer at the same door, on the same day, for the same bond. With 6 doors, that buyer is often missing. A market like that is called thin. Chapter 8 shows how to sell anyway.

To pyarlath: company bonds can be bought on the exchange through your broker, on a SEBI registered bond app, or in a public issue. RBI Retail Direct sells only government bonds. Whichever door you use, the bond lands in a register in your name, not with the app, so it cannot vanish when the app does.

To mukulgupta21: the coupon follows the register, and the register follows the settlement clock. Buy a few days before the record date if you want the next coupon.

6 doors make a bond easy to buy and harder to sell. Whichever door you use, find the bond in your own register after the trade.

Where to find today's figures

Every figure in this chapter is dated. This is where to find the current one.