There is good news for investors who invested in the units of the initial series of Sovereign Gold Bonds (SGBs). The returns in this series issued five years ago have more than doubled, that is, those who invested in this series have got excellent returns. Sovereign Gold Bond is a government bond and it is issued by the Reserve Bank. Its tenure is 8 years. However, the lock in period is 5 years. This means that if investors want, they have the opportunity to exit it after 5 years.
Sovereign Gold Bonds: There is good news for investors who invested in the units of the initial series of Sovereign Gold Bonds (SGBs). The returns in this series issued five years ago have more than doubled, that is, those who invested in this series have got excellent returns. Sovereign Gold Bond is a government bond and it is issued by the Reserve Bank. Its tenure is 8 years. However, the lock in period is 5 years. This means that if the investor wants, he has the opportunity to exit it after 5 years.
Sovereign Gold Bonds are also listed on the stock exchanges, but their trading is very low. However, to exit from it, the Reserve Bank (RBI) provides buyback facility in the fifth, sixth and seventh year. The initial redemption date of two series of Sovereign Gold Bonds – SGB 2016-17 Series IV and SGB 2019-20 Series IV was on 17 September 2024.
The 2016-17 series of sovereign gold bonds was issued on March 17, 2017, with an issue price of Rs 2,943. The premature redemption price at the end of 7.5 years was Rs 7,196 crore. Another gold bond ‘SGB 2019-20 Series IV’ was launched on September 17, 2019, with an issue price of Rs 3,890. The Reserve Bank has set its redemption price at Rs 7,278 after 5 years.
These bonds were first launched in November 2015 and have been sold in several tranches since then. Investors who wish to exit before the stipulated period can avail the buyback facility in the fifth, sixth and seventh year. Unitholders can request for redemption through the Reserve Bank’s receiving office, NSDL, CDSL and RBI Retail Direct platform.
Method of redemption of SGB units
You can inform your agent, bank or post office from where you purchased these bonds. Request redemption at least 10 days before the interest payment date. Pre-mature redemption requests are accepted by the Reserve Bank one month before the coupon payout date.
