New Delhi, April 13 (SocialNews.XYZ) The government has initiated the process of borrowing with the launch of sovereign gold bonds in consultation with the Reserve Bank of India in the current financial.
To be issued in six tranches by the RBI between April and September, 2020, the sovereign gold bond will provide assured return of 2.5 per cent to investors a long with appreciation in the price of the bond in line with movement of gold prices.
The bond will be on sale only in the domestic market for subscription by individuals, HUFs, Trusts, Universities and charitable institutions.
As per a press statement issued by the Finance Ministry, the sovereign gold bonds will be denominated in multiples of grams 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 5 years to be exercised on the interest payment dates.
Subscribers will be allowed minimum investment of 1 gm (value of bond) of gold while maximum level of subscription will be 4 kg of gold for individuals and HUF while 20 kg for trusts and similar entities per fiscal.
The price of the bond will be fixed in Indian rupees on the basis of simple average closing price of gold of .999 purity for the last 3 working days of the week preceding the subscription period. Those taking subscription through online route or other digital mode will get Rs 50 discounts on 1 gm worth of of sovereign gold bond. The redemption of the bond will also be in rupees based on three days average price of gold preceding the redemption request.
The bond will provide SLR cover to bank subscribers. It will be sold through banks, post offices, exchanges and through agents.
Source: IANS
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