Sovereign Gold Bonds Final Redemption Details for 2016-17 Series-II

Monday, 26 August 2024, 23:16

Sovereign Gold Bonds redemption for the 2016-17 Series-II is nearing, with final redemption expected by late September 2024. As investors prepare for the SGB final redemption, understanding the bond's features and benefits becomes crucial. This article discusses key aspects of the redemption process and SGB taxation updates.
Indiatimes
Sovereign Gold Bonds Final Redemption Details for 2016-17 Series-II

Sovereign Gold Bonds: A Smart Investment Choice

Sovereign Gold Bonds (SGB) are government securities that provide a viable alternative to holding physical gold. Issued by the Reserve Bank of India (RBI) on behalf of the Government of India, these bonds aim to reduce the demand for actual gold purchasing. Investors receive a Holding Certificate, and SGBs can also be converted into demat form.

SGB Final Redemption Timeline

  • Initial Issue Price: Rs 3,150 per gram of gold.
  • Interest Rate: A fixed 2.75% per annum.
  • Final Redemption Date: Tentatively at the end of September 2024.

The original SGB tranche was open for subscriptions from September 1 to September 9, 2016, and the bonds were released on September 30, 2016. It is critical to note that the bonds maintain a tenure of 8 years, allowing for premature redemption after the fifth year.

Determining Redemption Price

  1. The price is fixed based on the average closing price of gold of 999 purity published by the India Bullion and Jewellers Association Limited.
  2. Investors receive a notification regarding maturity one month prior to the SGB's maturity date.

For those considering early withdrawals, the RBI has outlined processes for premature redemption during the specified window.

Future Opportunities with Sovereign Gold Bonds

Investors should be aware of the features of future SGB issues and the opportunities they present. Each year, the RBI announces new tranches, allowing individuals to invest up to 4 kg with minimal investment prerequisites. Moreover, SGBs can serve as collateral for loans, further enhancing their utility.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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