The Sovereign Gold Bonds are going to be issued in six tranches from October 2020 to March 2021. So now you can plan your gold purchases. Following is the list for details:
| Tranche | Date of Subscription | Date of Issuance |
| 2020-21 Series VII | October 12-16,2020 | October 20,2020 |
| 2020-21 Series VIII | November 09-13,2020 | November 18,2020 |
| 2020-21 Series IX | December 28,2020- January01, 2021 | January 05, 2021 |
| 2020-21 Series X | January 11-15,2021 | January 19,2021 |
| 2020-21 Series XI | February 01-05,2021 | February 09,2021 |
| 2020-21 Series XII | March 01-05,2021 | March 09,2021 |
Reserve Bank of India has fixed the issue price at Rs.5,051 per gram of gold on behalf of the government of India, for the latest tranche of the sovereign Gold bonds that are due to open for subscription on Monday.
All you need to know before you invest in Sovereign Gold Bonds:
The Sovereign Gold Bonds are government securities denominated in grams of gold. According to the RBI, they are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds get redeemed in cash upon maturity. The Bond is issued by the Reserve Bank of India on behalf of the Government of India.
The Sovereign Gold Bonds are issued in denominations of one gram of gold and in multiples thereof. The minimum investment in the SGB shall be of one gram of gold and the maximum limit of subscription is of 4kg for individuals, 4kg for Hindu Undivided Family and 20kg of gold for trusts and similar entities as listed by the government per fiscal year.
Additionally, the annual ceiling includes the bonds subscribed under various tranches during initial issuance by the government and those purchased from the secondary market. The ceiling on the investment won’t include the holdings as collateral by banks and other financial institutions.
On maturity after 8 years, the bonds will be redeemed in Indian rupees and the price of redemption shall be based on the simple average of the closing price of gold 999 purity of the past 3 business days from the date of repayment, which is published by the India Bullion and Jewelers Association Limited.
In case you want to opt for an early encashment, you can do it only after the fifth year from the date of issue on the coupon payment dates. The bond is also tradable on Exchange if it’s held in the demat format and can be transferred to any other eligible investor.
The hype about Sovereign Gold Bond is essentially because the quantity of gold for which the investor pays is protected because you receive the ongoing market price at the time of redemption/premature redemption. Offering a steady alternative to holding gold in physical form, the cost of storage and risks associated with actual gold is eliminated. The investors can be assured of the market value of gold at the time of maturity and a periodical interest of 2.5%. The Sovereign Gold Bonds are free from issues such as the making charges and the purity in the case of gold in jewellery form. These bonds are held in the books of the RBI or in the demat form, eliminating any risk of loss.
You are eligible to invest in the Sovereign Gold Bond if you’re a resident of India as defined under the Foreign Exchange Management Act, 1999. In other words, eligible investors include individuals, HUFs, universities, trusts and charitable institutions.
Points to note here:
Joint holding is allowed.
A minor can also invest in the Sovereign Gold Bond, but the application has to be made by the guardian on the minor’s behalf.
The Sovereign Gold Bond are to be sold through banks (not the small finance banks and payment banks), Stock Holding Corporation of India, the designated post offices, and recognized stock exchanges, i.e. BSE and NSE.