The Centre has decided to launch the next series of Sovereign Gold Bonds (SGBs) for this financial year. The government has decided to issue two tranches of gold bonds in the first half of the current financial year.
The first tranche, 2023-24 Series I, will be issued from June 19 and continue till June 23. The second issue, 2023-24 Series II, will be issued between September 11 and 15, 2023, Reserve Bank of India (RBI) said in a statement. The issuance date for Series I is June 27, while tranche II issuance date is September 20, the RBI notification said.
| Tranche | Date of Subscription | Date of Issuance |
| 2023-24 Series I | June 19 - June 23, 2023 | June 27, 2023 |
| 2023-24 Series II | September 11-September 15, 2023 | September 20, 2023 |
SGBs, or Sovereign Gold Bonds, are issued by the RBI on behalf of the Centre as an alternative to buying physical gold. The SGB scheme was launched by the Government in November 2015, under Gold Monetisation Scheme. The gold bonds are restricted for sale to resident individuals, HUFs, Trusts, Universities and Charitable Institutions.
Here are some crucial points one should note:
1. The SGBs will be sold through Scheduled Commercial 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 Limited and Bombay Stock Exchange Limited.
2. It is to be noted that Small Finance Banks, Payment Banks and Regional Rural Banks won't be selling these bonds.
3. The SGBs are sold and denominated in multiples of gram(s) of gold with a basic unit of One gram.
4. The bond maturity period is 8 years. Though investors have an option of premature redemption after 5th year to be exercised on the date on which interest is payable.
5. There is an investment limit. The minimum permissible investment limit is one gram of gold. The maximum limit of subscription is 4 Kg for individuals, 4 Kg for HUF, and 20 Kg for trusts and similar entities per fiscal year (April-March).
6. The issue price of SGB will be fixed in Indian rupees on the basis of the simple average of the closing price of gold of 999 purity, published by the India Bullion and Jewellers Association Limited (IBJA) for the last three working days of the week preceding the subscription period.
7. The issue price of the SGBs will be less by Rs 50 per gram for the investors who subscribe online and pay through digital mode.
8. The investors will be offered a fixed interest rate of 2.50 per cent per annum payable semi-annually on the nominal value.
9. The redemption price will be in Indian rupees based on a simple average of closing price of gold of 999 purity, of previous three working days published by IBJA Ltd.
10. The gold bonds can be used as collateral for loans. The loan-to-value (LTV) ratio will be as applicable to any ordinary gold loan, mandated by RBI from time to time.
11. The SGBs are issued as Government of India Stock under the Government Securities Act, 2006. The investors will be issued a Certificate of Holding for buying the gold bonds. The SGBs will be eligible for conversion into demat form.
12. The interest on SGBs shall be taxable as per the provision of Income Tax Act, 1961 (43 of 1961). The capital gains tax arising on redemption of SGB to an individual is exempted. The indexation benefits will be provided to long term capital gains arising to any person on transfer of the SGB.
"The Sovereign Gold Bond scheme, issued by the Reserve Bank of India, offers retail investors a secure and lucrative investment opportunity. Backed by 99.9% pure gold held by the RBI, these bonds provide one of the safest avenues for investment. Since its launch in November 2015, the scheme has garnered immense popularity, with a total investment of approximately 27 tons of gold worth Rs 12,911 crore. Investors can benefit from the liquidity of these bonds, as they can be sold on the exchange after the 5th year. The cherry on top is the complete exemption from taxation on the capital gains realized upon maturity of these gold bonds," said Abhijit Roy, CEO, GoldenPi
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