Sovereign Gold Bond scheme opens Monday: Issue price, other details

The issue price for Sovereign Gold Bond Scheme 2021-22 has been fixed at Rs 5,19 per gram of gold, confirmed Reserve Bank of India (RBI) on Friday. 

Sovereign Gold Bond Scheme 2021-22 - Series X will be open for five days for subscription from February 28 to March 04, 2022. RBI has stated that the nominal value of the bond works out to be Rs 4,791 per gram of gold. The settlement date will be March 8, 2021. 

"In terms of Government of India Notification No.4(5)-B(W&M)/2021 dated October 21, 2021, Sovereign Gold Bonds 2021-22 (Series X) will be opened for subscription during the period February 28- March 04, 2022 with Settlement date March 08, 2022," noted the Ministry of Finance in an official statement. 

The government in consultation with the RBI has decided to allow a discount of Rs 50 per gram from the issue price to those investors who apply online and the payment is made through digital mode. 

For such investors the issue price of Gold Bond will be Rs 5,059 per gram of gold. The issue price for the previous series was Rs 4,786 per gram of gold.

The bonds will be sold through banks (except Small Finance Banks and Payment Banks), Stock Holding Corporation of India Limited (SHCIL), designated post offices, and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Limited.

The Sovereign Gold Bond Schemewas launched in November 2015 with an objective to reduce the demand for physical gold and shift a part of the domestic savings that are used for the purchase of gold into financial savings.

Price of bond is fixed in Indian Rupees on the basis of simple average of closing price of gold of 999 purity, published by the India Bullion and Jewellers Association Limited for the last 3 working days of the week preceding the subscription period.

The bonds will be denominated in multiples of gram (s) of gold with a basic unit of 1 gram. The tenor of the bond will be for a period of eight years with exit option after 5th year to be exercised on the next interest payment dates.

Minimum permissible investment is 1 gram of gold. The maximum limit of subscription is 4 KG for individual, 4 kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March).

The Know-your-customer (KYC) norms will be the same as that for purchase of physical gold.

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