Sovereign Gold Bond Scheme 2023-24 Series IV subscriptions will close on February 16, 2024. So, hurry before the opportunity is gone. The scheme opened for subscription on February 12, 2024. Investors will receive their subscriptions on February 21, seven days after the closing date.

The Reserve Bank of India (RBI) issues these bonds on behalf of the government to raise money from the market. Sovereign Gold Bonds (SGBs) offer modest returns with tax benefits. One can buy a minimum of one gram and a maximum of four kilograms of gold under the scheme.

Each gram of gold costs Rs 6,263, calculated based on its purity. Investors can get a Rs 50 discount for online purchases. SGBs offer a 2.5 per cent interest rate annually, besides the value increment over the invested period.

The Hindu undivided families (HUFs) can buy a maximum of 4 kg of gold, but trusts and similar entities can subscribe up to 20 kilograms per fiscal year.

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Maturity and Redemption

Sovereign Gold Bond Scheme 2023-24 has a maturity period of eight years, but they have an exit option from the 5th year, exercised on the interest payment dates. The redemption price is determined based on the closing price of gold over the preceding three business days.

Where Can You Buy SGBs?

One can buy them from scheduled commercial banks (excluding small finance banks, payment banks, and regional rural banks), designated post offices, Stock Holding Corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), and recognized stock exchanges, such as the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. One can also buy SGBs through RBI’s Retail Direct portal.

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Benefits of SGBs

SGBs offer an alternative way to invest in gold, eliminating the need for physical storage. Also, SGBs are not subjected to capital gains tax at maturity. SGBs are tradable on the stock market on a specified date provided by the issuer two weeks after the bonds are issued. They can also be transferred by executing a transfer instrument in line with the government securities regulations.

Premature Withdrawals

The investors can send premature withdrawal requests to banks, post offices, and other establishments 30 days before the coupon payout date. The amount is credited to the investor’s bank account directly.

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