Sovereign Gold Bond subscription of the third tranche opens today, issue price fixed at ₹4,889/gm

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The Government of India, in discussion with the Reserve Bank of India (RBI), has decided to issue Sovereign Gold Bonds. The Sovereign Gold Bonds will be issued in 6 tranches from May’21 to September’21. Series-I and II of Sovereign Gold Bond Schemes 2021-22 were opened for subscription on May 17 and 24.

The Series-III or 3rd tranche of Sovereign Gold Bond Scheme 2021-22 has been opened today for subscription and it will stay opened till June 4.

The issue price for the series-III or 3rd tranche of the sovereign gold bond issue has been decided at Rs 4,889 per gram, the Reserve Bank of India said.

“The nominal value of the bond is based on the simple average closing price for gold of 999 purity of the last three business days of the week preceding the subscription period, works out to Rs 4,889 per gram of gold,” the Reserve Bank of India said.

In consultation with the central bank, the government of India has offered a discount of Rs 50 per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode. After the discount, the issue price of the gold bond will be Rs 4,839 per gram of gold for these investors,” the RBI stated.

Bonds will be sold through Nationalised Banks, Scheduled Private Banks, Post Offices, Scheduled Foreign Banks, Stock Holding Corporation of India Ltd and the authorized stock exchanges either directly or through their agents.

The Sovereign Gold Bond Scheme was first launched in November 2015 to reduce the demand for physical gold. A total of Rs 25,702 crore has been accumulated through the SGB Scheme since its inception till March end 2021. The RBI had issued 12 tranches of SGB for an aggregate amount of Rs 16,049 crore, equal to 32.35 tonnes gold during 2020-21.

Sovereign Gold Bonds can be bought by Individuals, Hindu Undivided Families (HUFs), Trusts, Charitable Institutions and Universities. The minimum investment in the Bond will be one gram with a maximum limit of subscription of 4 Kg for individuals and HUF respectively, and 20 Kg for trusts and other entities.

Know Your Customer (KYC) norms will be the same for sovereign gold bonds as that for the purchase of physical gold.