SGB Scheme: Sovereign Gold Bond Scheme: Issue price set at Rs 5,197/g; subscription opens Monday
“The face value of the bond…equivalent to Rs 5,197,” the central bank said in a statement.
The central government, in consultation with the Reserve Bank of India, has decided to offer a rebate of Rs 50 per gram, below face value, to investors who apply online and payment against the application is made digitally. .
“For these investors, the issue price of Gold Bond will be Rs 5,147 per gram of gold,” the RBI said.
The RBI issues the bonds on behalf of the Centre.
The bonds will be sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices and recognized stock exchanges — NSE and BSE.
The program was launched in November 2015 with the aim of reducing the demand for physical gold and transforming part of the domestic savings – used for the purchase of gold – into financial savings.
The price of the bond is fixed in Indian currency based on a simple average closing price of 999 purity gold, published by the India Bullion and Jewelers Association Limited for the last 3 working days of the week preceding the subscription period.
Bonds are denominated in multiples of gram(s) of gold with a base unit of 1 gram. The term of the bond will be 8 years with an exit option after the 5th year to be exercised on the next interest payment dates.
The minimum authorized investment is 01 gram of gold. The maximum subscription limit is 4 kg for individuals, 4 kg for HUFs and 20 kg for trusts and similar per financial year (April-March).
Know-your-customer (KYC) standards will be the same as for buying physical gold.