Sovereign Gold Bond (SGB) Scheme : RBI
The Reserve Bank of India (RBI) recently announced the issue price for the upcoming Sovereign Gold Bond (SGB) Tranche 2.
- Sovereign Gold Bond (SGB) Scheme were introduced by the Government of India in 2015 under the Gold Monetization Scheme.
- SGBs are government securities issued by the RBI on behalf of the Government of India.
- They are substitutes for holding physical gold.
- SGBs are denominated in grams of gold with a basic unit of 1 gram.
- Investors have to pay the issue price in cash, and the bonds will be redeemed in cash on maturity.
- The Bonds will be restricted for sale to resident Indian entities, including individuals (in his capacity as an individual, or on behalf of the minor child, or jointly with any other individual), HUFs, Trusts, Universities and Charitable Institutions.
- The tenor of the Bond will be for a period of 8 years with an exit option in the 5th, 6th and 7th year, to be exercised on the interest payment dates.
- Investment Limit:
- Minimum: 1 gram of gold.
- Maximum: 4 KG for individuals, 4 Kg for HUF and 20 Kg for trusts.
- Interest: 2.5% per annum, paid on a half-yearly basis.
