The Reserve Bank of India (RBI) will open subscriptions for the Series IV of its Sovereign Gold Bond Scheme 2022-23 on March 6 (Monday). It would be the final payment for the fiscal year.
It would be available for subscription until March 10. SGBs, or Sovereign Gold Bonds, are issued on behalf of the Centre by the Reserve Bank of India (RBI) as an alternative to purchasing physical gold. The RBI has set the issue price of gold at Rs 5,611 per gram. The RBI offered a December 2022 issue price of Rs 5,409 per gram.
Overview
The bond’s nominal value is determined by taking the simple average of all the last three working days during the week before the subscribers’ period for gold of 999 pureness.
The interest rate on these bonds is 2.50 percent per year on the initial investment investors make to purchase the bond. SGBs will be revalued in gram(s) of multiple gold copies, with one gram as the basic unit.
It also provides a Rs 50 discount to investors who bid digitally or apply online. SGB has an 8-year lock-in period. In the fifth year, an exit option can be used on interest payment days.
Final Note
The investors will be given a Certificate of Holding in exchange for their investment. SGBs would be eligible for demat conversion and as loan collateral.
The loan-to-value (LTV) ratio, as mandated by the Reserve Bank of India occasionally, will apply to any general gold loan available in the market.
