Sovereign Gold Bond Scheme 2023-24 (Series III) will open for subscription from 18 Dec to 22 Dec 2023
The Government of India has announced that they will issue Sovereign Gold Bonds for the year 2023-24 (Series III). These bonds will be available for subscription from December 18 to December 22, 2023, and the bonds will be issued on December 28, 2023.
The price of these bonds during the subscription period will be ₹6,199 per gram of gold. However, if you apply for these bonds online and make the payment digitally, you will get a discount of ₹50 per gram. So, the price for online and digital payments will be ₹6,149 per gram of gold.
This information is important for those interested in the Sovereign Gold Bond Scheme, and it’s a way to invest in gold through government bonds.
Earlier series of the Sovereign fold bond Scheme 2023-24
The Government of India, in consultation with the Reserve Bank of India, has decided to issue Sovereign Gold Bonds (SGBs) in tranches as per the calendar specified below:
S. No. | Tranche | Date of Subscription | Date of Issuance |
1. | 2023-24 Series I | June 19 – June 23, 2023 | June 27, 2023 |
2. | 2023-24 Series II | September 11-September 15, 2023 | September 20, 2023 |
The SGBs will be sold through Scheduled Commercial banks (except Small Finance Banks, Payment Banks and Regional Rural Banks), Stock Holding Corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), designated post offices, and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Limited.
The features of the Bond 2023-24:
Sl. No. | Item | Details |
1 | Product name | Sovereign Gold Bond Scheme 2023-24 |
2 | Issuance | To be issued by the Reserve Bank of India on behalf of the Government of India. |
3 | Eligibility | The SGBs will be restricted for sale to resident individuals, HUFs, Trusts, Universities and Charitable Institutions. |
4 | Denomination | The SGBs will be denominated in multiples of gram(s) of gold with a basic unit of One gram. |
5 | Tenor | The tenor of the SGB will be for a period of eight years with an option of premature redemption after 5th year to be exercised on the date on which interest is payable. |
6 | Minimum size | Minimum permissible investment will be One 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 year (April-March) notified by the Government from time to time. A self-declaration to this effect will be obtained from the investors at the time of making an application for subscription. The annual ceiling will include SGBs subscribed under different tranches, and those purchased from the secondary market, during the fiscal year. |
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 SGB 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 (IBJA) for the last three working days of the week preceding the subscription period. The issue price of the SGBs will be less by ₹50 per gram for the investors who subscribe online and pay through digital mode. |
10 | Payment option | Payment for the SGBs will be through cash payment (upto a maximum of ₹20,000) or demand draft or cheque or electronic banking. |
11 | Issuance form | The SGBs will be issued as Government of India Stock under Government Securities Act, 2006. The investors will be issued a Certificate of Holding for the same. The SGBs will be 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 three working days published by IBJA Ltd. |
13 | Sales channel | SGBs will be sold through Scheduled Commercial banks (except Small Finance Banks, Payment Banks and Regional Rural Banks), Stock Holding Corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), designated post offices (as may be notified) and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Limited, either directly or through agents. |
14 | Interest rate | The investors will be compensated at a fixed rate of 2.50 per cent per annum payable semi-annually on the nominal value. |
15 | Collateral | The SGBs can be used as collateral for loans. The loan-to-value (LTV) ratio will be as applicable to any 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 SGBs 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 is exempted. The indexation benefits will be provided to long term capital gains arising to any person on transfer of the SGB. |
18 | Tradability | SGBs shall be eligible for trading. |
19 | SLR eligibility | SGBs 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 one per cent of the total subscription received by the receiving offices and receiving offices shall share at least 50 per cent of the commission so received with the agents or sub agents for the business procured through them. |
All about Sovereign Gold Bond Scheme
Are you seeking a secure and profitable investment option? Look no further! The Sovereign Gold Bond Scheme may just be what you need! This scheme is Designed to combine the benefits of gold ownership with paper investments; this scheme presents individuals with an ideal way to protect their wealth while reaping attractive returns. Let’s examine its details and maximize its potential!
What is the Sovereign Gold Bond Scheme?
The Sovereign Gold Bond Scheme introduced by the Government of India provides individuals with an innovative investment avenue to purchase gold non-physically. It seeks to maximize the benefits associated with ownership, such as capital appreciation and protection against inflation, while mitigating drawbacks, such as storage and security concerns associated with physical gold ownership.
How does the Sovereign Gold Bond Scheme work?
By investing in the Sovereign Gold Bond Scheme, you are purchasing gold through bonds issued by the government. These bonds have an eight year fixed tenure with an exit option after five years; their value tracks that of gold prices in the market; annual interest payments will also be made annually on them at a set rate.
Why should you consider investing in the Sovereign Gold Bond Scheme?
Investing in the Sovereign Gold Bond Scheme offers a multitude of benefits that make it an attractive investment option for individuals seeking stability, growth, and diversification.
Earn a fixed interest rate: Unlike physical gold, which does not generate any income, Sovereign Gold Bonds offer annual interest payments, providing a regular income stream.
Capital appreciation: As the value of gold tends to increase over time, investing in Sovereign Gold Bonds allows you to benefit from capital appreciation.
Liquidity: Sovereign Gold Bonds can be easily bought and sold on the stock exchanges, providing you with liquidity when required.
Tax advantages: The interest earned on Sovereign Gold Bonds is taxable as per the individual’s income tax slab, but the capital gains arising on redemption are tax-free.
Safety and security: The Sovereign Gold Bond Scheme is backed by the Government of India, making it a highly secure investment option.
No storage or making charges: Unlike physical gold, you don’t have to worry about storage costs or the risk of theft.
Conclusion
The Sovereign Gold Bond Scheme offers a compelling investment opportunity for individuals looking to diversify their portfolios, protect their wealth, and earn attractive returns. By investing in these bonds, you can enjoy the benefits of gold