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Sovereign Gold Bond Scheme 2022-23 (Series III) – Issue Price
About the Sovereign Gold Bond Scheme:
- The sovereign gold bond was introduced by the Government in 2015.
- Government introduced these bonds to help reduce India’s over dependence on gold imports.
- The move was also aimed at changing the habits of Indians from saving in physical form of gold to a paper form with Sovereign backing.
Key facts:
- Eligibility: The bonds will be restricted for sale to resident Indian entities, including individuals, HUFs, trusts, universities and charitable institutions.
- Denomination and tenor: The bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram. The tenor will be for a period of 8 years with exit option from the 5th year to be exercised on the interest payment dates.
- Minimum and Maximum limit: The minimum permissible investment limit will be 1 gram of gold, while the maximum limit will be 4 kg for individuals, 4 kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March) notified by the government from time to time.
- Joint Holder: In case of joint holding, the investment limit of 4 kg will be applied to the first applicant only.
- Collateral: Bonds can be used as collateral for loans. The loan-to-value (LTV) ratio is to be set equal to ordinary gold loans mandated by the Reserve Bank from time to time.
- 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 interest payment dates.
- Interest rate: The investors will be compensated at a fixed rate of 2.50 percent per annum payable semi-annually on the nominal value.
