The government has decided to issue the bonds in six tranches from May 2021 to September 2021. The RBI will issue the bonds on behalf of the Government of India.
“The nominal value of the bond 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 4,777 per gram of gold,” the RBI said.
The government, in consultation with the RBI, has decided to offer 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.
“For such investors, the issue price of gold bond will be Rs 4,727 per gram of gold,” the RBI said.
The Sovereign Gold Bond Scheme 2021-22 Series-I or first tranche will be open for subscription from May 17, 2021 to May 21, 2021, and bonds will be issued on May 25.
The bonds will be sold through banks (except Small Finance Banks and Payment Banks), Stock Holding Corporation of India Limited (SHCIL), designated post offices, and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Limited.
Price of bond is 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 for the last three working days of the week preceding the subscription period.
The bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram. The tenor of the bond will be for a period of 8 years with exit option after 5th year to be exercised on the next interest payment dates.
Minimum permissible investment is 1 gram of gold. The maximum limit of subscription is 4 kg for individual, 4 kg for HUF and 20 Kg for trusts and similar entities per fiscal (April-March).
The Know-your-customer (KYC) norms will be the same as that for purchase of physical gold.
The scheme was launched in November 2015 with an objective to reduce the demand for physical gold and shift a part of the domestic savings — used for the purchase of gold — into financial savings.
