Sovereign gold bond scheme opens today; issue price Rs 4,765 per gram of gold

11:28 AM Oct 25, 2021 | FPJ Web Desk

Sovereign Gold Bonds (SGB) scheme 2021-22 opens for subscription today (October 25).

What is the issue price?


The issue price for Sovereign Gold Bonds has been fixed at Rs 4,765 per gram of gold.


How long is Series VII open for subscription?

According to the Ministry of Finance, the Sovereign Gold Bond Scheme 2021-22 (Series VII) will be opened for subscription during the period October 25-29, and the settlement date has been set at November 2.

“Government of India in consultation with the Reserve Bank of India has decided to allow discount of Rs 50 per gram from the issue price to those investors who apply online and the payment is made through digital mode,” it said.

“For such investors the issue price of ‘Gold Bond’ will be Rs 4,715 per gram of gold.”

What are sovereign gold bonds?

The SGBs are government securities denominated in grams of gold. Besides, they are substitutes for holding physical gold.A

Under the scheme, investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity.

The bond is issued by Reserve Bank on behalf of the government.

Last year, the government had announced SGBs in six tranches from May to September 2021. The fourth tranche of SGB 2021-22, which was sold from July 12 to 16, was offered at Rs 4,807 per 10 gm. The May tranche was sold at Rs 4,889 per gm.

How to buy Sovereign Gold Bonds?

The bonds will be sold through banks (except small finance banks and payment banks), Stock Holding Corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), designated post offices, and recognised stock exchanges (National Stock Exchange of India and Bombay Stock Exchange).

What is the term of SGBs?

The term of the bond will be for eight years with an exit option after the fifth year that can be availed on the next interest payment dates. The investors will be compensated at a fixed rate of 2.50 per cent per annum payable semi-annually on the nominal value.

What is the minimum and maximum permissible limit for subscription?

The minimum allowable investment will be 1 gram of gold. The maximum limit of subscription shall be 4 kg for individuals, 4 Kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March).

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