Second Series Of Sovereign Gold Bonds For FY 23 Opens For Subscription Today

The second series of sovereign gold bonds (SGBs) for the current fiscal (FY 2022-23) will open for subscription on August 22, 2022. The issue price will be Rs 5,197 per gram, according to a release by the Reserve Bank of India (RBI). 

However, the RBI is offering a discount of Rs 50 per gram to investors who will purchase these via the online mode. The issue price for such investors will be Rs 5,147 per gram against the regular price of Rs 5,197. 

The applications for gold bonds will be accepted till August 26, the statement added. 

“The nominal value of the bond based on the simple average closing price (published by the India Bullion and Jewellers Association Ltd (IBJA)] for gold of 999 purity of the last three working days of the week preceding the subscription period, i.e., August 17, 18, and 19, 2022, works out to ₹5,197 per gram of gold,” the RBI said in a statement.

Features of SGBs

• These bonds can be purchased by individuals, trusts, charitable institutions, and Hindu Undivided Families (HUFs). 

• They can be bought through commercial banks, Stock Holding Corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), designated post offices notified by the RBI, and recognised stock exchanges, either directly or through agents.

• The minimum permissible investment is one gram of gold. The maximum limit of subscription would be 4 kg for individuals, 4 kg for HUF, and 20 kg for trusts, and similar entities per fiscal year (April to March), as notified by the government at regular intervals. 

• The investor can make the payment for these SGBs via cash (up to a maximum of Rs 20,000), through demand draft, cheque, or, electronic banking. 

• The investors will be compensated at a fixed rate of 2.5 per cent per annum payable semi-annually on the nominal value. Such SGBs are also eligible for trading.

• They will have a lock-in period of eight years, but can be redeemed during the buyback window offered by the RBI in the fifth year. 

• They can also be used as collaterals for loans. 

Should You Buy Them?

According to experts, SGBs are a good investment option. They are efficient, profitable, and an economical mode of investment in digital gold as compared to buying physical gold. Besides earning interest, they come with the additional benefit of a sovereign guarantee. 

They are also tax-efficient compared to physical gold.