India to Issue Sovereign Gold Bonds in Six Tranches

SEATTLE (Scrap Monster): The Indian government has started consultations with the Reserve Bank of India (RBI) to launch sovereign gold bonds (SGBs). The bonds will be launched in six tranches.

The subscription date for the first tranche for FY22 will be between May 17 and May 21. The date of issuance is fixed as May 25th. Similarly, the date of subscription for the second tranche will be May 24-May28. The subscription date for Series III bond and Series IV bonds will be May 31-June 4 and July 12-July 16 respectively. The fifth tranche will be launched during August 9-August 13, whereas the sixth and final tranche is scheduled for launch between August 30 and September 3.

RELATED NEWS:

RBI's Latest Gold Bond Scheme Witnessed Record Investment

State Bank of India Mobilized 13 Tonnes of Hoarded Gold

The bonds will have a maturity period of eight years, with an exit option after the lock-in period of 5 years. The investors will be paid interest at a fixed rate of 2.5% per annum on the nominal value, which will be paid semi-annually.

According to notification published by the Finance Ministry, the bonds will be restricted for sale to resident individuals, HUFs, Trusts, Universities, and Charitable Institutions. The minimum investment will be 1 gram of gold.

The SGBs help investors to diversify their portfolio. Furthermore, they can also be used as collaterals for loans.