Finance Minister Arun Jaitley on Sunday said that the electoral bonds scheme, which the Centre notified on January 2, is a substantial improvement in transparency of political funding compared to the present system. In a Facebook post, the finance minister also said the government was open to suggestions to further cleanse the system of political funding in India.

“The conventional practice of funding the political system was to take donations in cash,” Jaitley said. “The sources are anonymous or pseudonymous. The quantum of money was never disclosed. The present system ensures unclean money coming from unidentifiable sources. It is a wholly non-transparent system.”

In a jibe at the Opposition, the finance minister added that most political parties in the country seemed to be “fairly satisfied” with the present system. “The effort, therefore, is to run down any alternative system which is devised to cleanse up the political funding mechanism,” he said.

Jaitley said that despite some reforms in the system of political funding during the Atal Behari Vajpayee and Manmohan Singh’s tenures, only a small percentage of donors used cheques to donate money. The finance minister said the electoral bonds scheme “envisages total clean money and substantial transparency coming into the system of political funding”.

“A donor can purchase electoral bonds from a specified bank only by a banking instrument,” he added. “He would have to disclose in his accounts the amount of political bonds that he has purchased”. According to the scheme, the bond will be valid only for 15 days, and every political party in its returns will have to disclose the amount of donations it has received through electoral bonds.

The finance minister said donors now had to make a choice between unclean and clean methods of donating to political parties. “While all three methods [cheque, online transactions and electoral bonds] involve clean money, the first two are totally transparent and the electoral bonds scheme is a substantial improvement in transparency,” he added.