What Are Sovereign Gold Bonds? Here’s All You Need To Know

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Sovereign Gold Bonds will be available at an issue price of Rs 4,777 per unit

The government’s Sovereign Gold Bonds Scheme 2021-22, which will be issued in six trances in this financial year, opened for subscription with its first tranche on Monday, May 17. The subscription for the first tranche will close on May 21, 2021, remaining open for investors for a period of five days, according to the Ministry of Finance. The Reserve Bank of India issues the interest-paying bonds linked to the market price of the yellow metal, as part of the sovereign gold bond scheme. (Also Read: Sovereign Gold Bonds 2021-22: Subscription For First Tranche Starts On May 17 )

The Sovereign Gold Bond Scheme was launched in 2015 along with the Gold Monetisation Scheme and provides gold-linked returns. According to wealth planners, gold bonds are a safer and effective way to invest in non-physical gold.

Here are key things to know about the Sovereign Gold Bond (SGB) scheme:

Important Dates

Tranche Date of Subscription Date of Issuance
2021-22 Series I May 17-21, 2021 May 25, 2021
2021-22 Series II May 24-28, 2021 June 1, 2021
2021-22 Series III May 31-June 4, 2021 June 8, 2021
2021-22 Series IV June 12-16, 2021 June 20, 2021
2021-22 Series V August 9-13, 2021 August 17, 2021
2021-22 Series VI August 30-September 3 2021 September 7, 2021
Source: Ministry of Finance

Issue Price

For the first tranche of the gold bond scheme 2021-22, an issue price of Rs 4,777 per unit, equivalent to the value of one gram of gold is applicable, according to the Reserve Bank. The rate is arrived at on the basis of the spot prices provided by the Mumbai-based India Bullion and Jewellers Association (IBJA).  
 

Discount

A discount of Rs 50 per unit is applicable for all those investing in the gold bonds online, and the payment against the application is made through a digital modes. For such investors, the issue price of the gold price will be Rs 4,727 per gram of gold. (Also Read:Here Is How Sovereign Gold Bond Price Is Calculated)

How To Invest

The sovereign gold bonds are sold through designated post offices, the recognised stock exchanges – Bombay Stock Exchange Limited and National Stock Exchange of India, and the Stock Holding Corporation of India Limited. The gold bonds are held in the RBI books or in a demat form. 
 

Eligible Investors

The gold bond scheme is open to resident individuals, Hindu Undivided Families or HUFs, trusts, universities, and charitable institutions.



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