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Sovereign Gold Bond scheme 2018-19Reuters file

The government of India Friday announced the issue date of the first tranche of government-backed Sovereign Gold Bond (SGB) in this financial year.

SGBs are issued by the Reserve Bank of India (RBI) and are considered to be alternatives to owning physical gold. People can buy SGB through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices and National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

know all the details about the SGB scheme 2018-19:

  • Applications for the bond will be accepted from April 16 to 20. The certificate of bonds will be issued on May 4, 2018
  • Under the SGB scheme, the bonds are denominated in units of one gram of gold and multiples thereof. There are minimum and maximum investment limits under SGB scheme. Minimum investment in the bonds is one gram and the maximum limit of subscription is 500 grams per person per fiscal year (April-March)
  • The maximum limit of subscription would be 4 kg for individual and HUF and 20 kg for trusts and similar entities per fiscal (April-March) notified by the government from time to time
  • The issue price of the gold bond will be Rs 50 per gram less for those who subscribe online and pay through digital mode
  • The SGB investors will be compensated at a fixed rate of 2.50 percent per annum payable semi-annually on the nominal value
  • For purchasing SGB, the know-your-customer (KYC) norms will be the same as that for the purchase of physical gold. KYC documents like voter ID, Aadhaar card/PAN or TAN /Passport will be required
  • The SGBs will be tradable on stock exchanges within a fortnight of the issuance on a date as notified by the RBI
  • The investors will be paid Interest on the amount of initial investment at the rate notified by RBI