Sovereign Gold Bond Scheme opens today: Big opportunity to buy gold at low prices

New Delhi: The Sovereign Gold Bond Scheme 2021-22 - Series- IX or the ninth tranche will be open for subscription from today (Monday, January 10).

The Sovereign Gold Bond Scheme 2021-22 - Series IX will be open for subscription for for five days period January 10 to January 15. The issue price for Sovereign Gold Bond Scheme 2021-22 Series- IX has been fixed at Rs 4,791 per gram of gold.

The nominal value of the bond "works out to Rs 4,786 per gram of gold", the central bank said in a statement. The Government of India, in consultation with the Reserve Bank, has decided to offer a discount of Rs 50 per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode.

"For such investors, the issue price of gold bond will be Rs 4,736 per gram of gold," the RBI said.

The tenure of the bond will be for a period of eight years with an exit option after fifth year to be exercised on the next interest payment dates. The investors will be compensated at a fixed rate of 2.50 per cent per annum payable semi-annually on the nominal value, said the ministry adding the minimum permissible investment will be 1 gram of gold.

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).
Know Your Customer (KYC) norms will be the same as that for the purchase of physical gold. The sovereign gold bond scheme was launched in November 2015, with an objective to reduce the demand for physical gold and shift a part of the domestic savings -- used for the purchase of gold -- into financial savings. 

What is Sovereign Gold Bond Scheme?

Sovereign Gold Bond Scheme are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity. The Bond is issued by Reserve Bank on behalf of Government of India.

How will the Sovereign Gold Bond Scheme be sold?

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.

Who can buy Sovereign Gold Bond Scheme?

The Bonds will be restricted for sale to resident individuals, HUFs, Trusts, Universities and Charitable Institutions.