Press Releases

PDF document (351 kb)
Date : Oct 09, 2020
Sovereign Gold Bond Scheme 2020-21

Government of India, in consultation with the Reserve Bank of India, has decided to issue Sovereign Gold Bonds. The Sovereign Gold Bonds will be issued in six tranches from October 2020 to March 2021 as per the calendar specified below:

S. No. Tranche Date of Subscription Date of Issuance
1. 2020-21 Series VII October 12 - 16, 2020 October 20, 2020
2. 2020-21 Series VIII November 09 - 13, 2020 November 18, 2020
3. 2020-21 Series IX December 28 2020 - January 01, 2021 January 05, 2021
4. 2020-21 Series X January 11-15, 2021 January 19, 2021
5. 2020-21 Series XI February 01- 05, 2021 February 09, 2021
6. 2020-21 Series XII March 01- 05, 2021 March 09, 2021

The Bonds will be sold through Scheduled Commercial 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 features of the Bond are as under:

Sl. No. Item Details
1 Product name Sovereign Gold Bond 2020-21
2 Issuance To be issued by Reserve Bank of India on behalf of the Government of India.
3 Eligibility The Bonds will be restricted for sale to resident individuals, HUFs, Trusts, Universities and Charitable Institutions.
4 Denomination The Bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram.
5 Tenor The tenor of the Bond will be for a period of 8 years with exit option after 5th year to be exercised on the next interest payment dates.
6 Minimum size Minimum permissible investment will be 1 gram of gold.
7 Maximum limit The maximum limit of subscription shall be 4 KG for individual, 4 Kg for HUF and 20 Kg for trusts and similar entities per fiscal (April-March) notified by the Government from time to time. A self-declaration to this effect will be obtained. The annual ceiling will include bonds subscribed under different tranches during initial issuance by Government and those purchased from the Secondary Market.
8 Joint holder In case of joint holding, the investment limit of 4 KG will be applied to the first applicant only.
9 Issue price Price of Bond will be 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 issue price of the Gold Bonds will be ₹ 50 per gram less for those who subscribe online and pay through digital mode.
10 Payment option Payment for the Bonds will be through cash payment (up to a maximum of ₹ 20,000) or demand draft or cheque or electronic banking.
11 Issuance form The Gold Bonds will be issued as Government of India Stock under GS Act, 2006. The investors will be issued a Holding Certificate for the same. The Bonds are eligible for conversion into demat form.
12 Redemption price The redemption price will be in Indian Rupees based on simple average of closing price of gold of 999 purity, of previous 3 working days published by IBJA Ltd.
13 Sales channel Bonds will be sold through Commercial banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices (as may be notified) and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange, either directly or through agents.
14 Interest rate The investors will be compensated at a fixed rate of 2.50 percent per annum payable semi-annually on the nominal value.
15 Collateral Bonds can be used as collateral for loans. The loan-to-value (LTV) ratio is to be set equal to ordinary gold loan mandated by the Reserve Bank from time to time.
16 KYC documentation Know-your-customer (KYC) norms will be the same as that for purchase of physical gold. KYC documents such as Voter ID, Aadhaar card/PAN or TAN /Passport will be required. Every application must be accompanied by the ‘PAN Number’ issued by the Income Tax Department to individuals and other entities.
17 Tax treatment The interest on Gold Bonds 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 has been exempted. The indexation benefits will be provided to long term capital gains arising to any person on transfer of bond.
18 Tradability Bonds will be tradable on stock exchanges.
19 SLR eligibility Bonds acquired by the banks through the process of invoking lien/hypothecation/pledge alone, shall be counted towards Statutory Liquidity Ratio.
20 Commission Commission for distribution of the bond shall be paid at the rate of 1% of the total subscription received by the receiving offices and receiving offices shall share at least 50% of the commission so received with the agents or sub agents for the business procured through them.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2020-2021/462


2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
Archives
Top