The Finance Minister (of the 16th Lok Sabha) introduced legislation to permit the use of electoral bonds, issued by the Reserve Bank of India, which will make it easier to donate money to political parties.
Association for Democratic Reforms
Simply put, electoral bonds are like promissory notes, bearer bonds or any other financial instrument. Any person can buy these bonds from a notified bank, and then deposit them in an account listed out by a political party.
How does that clean up electoral funding, if it is basically an alternative currency that can only be paid to political parties? The government presumes that the notified banks will act as the filter to make sure there is only white money coming into the electoral bonds.