Today is last day to Invest in Sovereign Gold Bonds (SGB)

The subscription for fifth tranche of Gold Bonds ends today, August 8 2020. Currently with unprecedented rally in gold prices, SGBs offer opportunity to purchase paper gold at discount.

Gold bonds are issued by RBI and offer a fixed 2.5% interest earning (taxable) as well as tax exempt capital appreciation in gold value at the end of 8 years lock-in. Current gold bond price is fixed at Rs 5,334 per gram for offline purchases and Rs. 5,284 per gram on online purchase.

Compared to market price of Gold which is Rs 5800, today’s purchase appears as a steal deal

The final series VI – of the gold bond for FY 2020-21 scheme will be available from August 31 till September 04, 2020.

The gold bonds have a fixed tenor of eight years. You get an exit option after fifth year.

Why purchase Gold Bonds?

Benefits of purchasing Gold Bonds:

• These bonds are issued by the Reserve Bank of India, and thus qualify as safe investment.
• These SGBs are linked to the market price of gold and additionally offer you annual return of 2.5 per cent.
• The online subscription offers Rs 50 discount.
• Amid current volatility of the markets due to pandemic spread, gold turns into a safe-haven.
• You can Apply for Gold Loan against sovereign gold bonds.

Who can buy Sovereign Gold Bonds?

All Indian entities or resident individuals can purchase the Sovereign Gold Bonds, issued by RBI. You can be classified as:

A) Resident individuals 
B) Hindu Undivided Families (HUFs) 
C) Trusts, universities and charitable institutions

How to buy Sovereign Gold Bonds?

You can buy Gold buys online or offline. Contact designated post offices, stock exchanges BSE and NSE, and the Stock Holding Corporation for purchasing these bonds. You can also buy by accessing internet banking.

What is the price of Series V of the Sovereign Gold Bond?

Gold Price for Series V is set at Rs 5,334 per gram. Online purchase will entitle discount of Rs 50 per gram and thus net price for online transaction will be Rs. 5,284 per gram.

How much you can invest in Sovereign Gold Bonds?

For individuals and HUFs, purchase limit is capped at 4 Kilograms in a financial year. You can choose any amount ranging from one gram to 4000 grams as per your needs. The trusts and similar entities however can purchase up to 20 Kgs in a financial year.