The fourth series (tranche) of the Sovereign Gold Bond Scheme (SBS) will open on July 18 and close on July 22, allowing investors to buy gold bonds carrying 2.75 percent interest payable semi-annually. The bonds will be issued on Aug. 15.
The minimum subscription will be for 1 gm and the maximum is 500 gm per applicant. Individuals, Hindu undivided families (HUFs), Trusts, Universities and charitable institutions are eligible to apply.
The price will be fixed "on the basis of simple average of closing price of gold of 999 purity published by the India Bullion and Jewellers Association Limited for the week (Monday to Friday) preceding the subscription period," the Reserve Bank of India (RBI) said in a statement.
Here are the features of the fourth issue, according to RBI:
The Bonds will be available in multiples of gram(s) of gold with a basic unit of 1 gram.
The Bonds will be issue for a period of 8 years with exit option from 5th year to be exercised on the interest payment dates.
In case of joint holding, the investment limit of 500 grams will be applied to the first applicant only.
The price of the Bond 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 week (Monday to Friday) preceding the subscription period.
Payment for the Bonds will be through cash payment (up to a maximum of Rs. 20,000) or demand draft or cheque or electronic banking.
The redemption price will be in Indian rupees based on previous week's (Monday-Friday) simple average of closing price of gold of 999 purity published by IBJA.
The Bonds will be sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices as may be notified and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange, either directly or through agents.
The Bonds will carry will carry fixed rate of 2.75 percent per annum interest payable semi-annually on the initial value of investment.
The Bonds will be tradable on stock exchanges/NDS-OM from a date to be notified by RBI.