Sovereign Gold Bond Scheme 2023-24 (Series II)

GS Paper III Indian Economy

Context:

Sovereign Gold Bonds 2023-24 (Series II) will be opened for subscription during the period September 11-15, 2023.

Sovereign Gold Bond (SGB)Scheme:

Sovereign Gold Bond (SGB):

SGBs 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 the Reserve Bank on behalf of Government of India.

The SGB Scheme was launched by the Government in November 2015, under the Gold Monetization Scheme.
In this scheme, the issues are made open for subscription in tranches by RBI in consultation with GOI.

Features of the scheme:

Minimum value: Sovereign Gold Bonds will be denominated in the multiples of a gram of gold with a minimum unit of 1 gram.
Maximum limit: The maximum limit of gold prices which can be subscribed by an individual is 4 kg, 4 kg for a Hindu-Undivided Family and 20 kg for trusts and other similar entities.
- If the gold bonds are co-owned, the limit of investment will be 4kg which will be applied to the first applicant only.
Interest rate: The interest for the gold bonds will be 2.50% per annum which is payable semi-annually on the nominal value.
Tenure: The tenure of the bond will be for a period of 8 years with an exit option available in the 5th, 6th and 7th year on the dates of interest payment.