New Delhi: At a time when the demand for the yellow metal is increasing, the second tranche of gold bonds of this year (2020-21) will open for subscription on Monday. The series II of the sovereign gold bond scheme for 2020-21 will close for subscription on May 15. Also Read - Sovereign Gold Bond scheme to open from Oct 15
As per updates, the price of the latest gold bond scheme has been fixed at 4,590 per gram while the issue date is May 19. People, who are interested in applying online and making payment through digital mode will get a discount of Rs 50 per gram. For such investors, the issue price of the bond, however, will be RS 4,540 per gram of gold. Also Read - Sovereign Gold Bond schemes opens from Oct 15
This Sovereign Gold Bond Scheme is issued by the Reserve Bank of India (RBI) on behalf of the Central government. Also Read - Government Announces Third Edition Of Sovereign Gold Bond Scheme, Will Remain Tradable For Eight Years
Launched in November 2015, the prime objective of the Sovereign Gold Bond Scheme is to reduce the demand for physical gold and shift a part of it for the domestic savings.
1) The central government had in April issued the Series 1 tranche of gold bonds and the second series comes at a time when the demand for the precious metal is rising.
2) As per the latest updates, the Gold holdings with SPDR ETF have risen to multi-year highs of 1075.8 tonnes.
3) The gold futures prices on MCX in April had increased to record high above Rs 47,000 per 10 gram. Moreover, the gold prices in the past one year have gone up about 40%.
4) Notably, the Gold ETFs which are being offered by mutual funds in the country have seen an inflow of Rs 731 crore last month.
5) The Sovereign Gold Bond Scheme’s price is fixed based on the recent closing price of gold as published by the India Bullion and Jewellers Association Ltd for gold of 999 purity.
6) All must note that the minimum permissible investment in gold bonds is one gram of gold and the scheme will mature in eight years.
7) In 8 years time, investors have the option to leave the plan after the fifth year.
8) The Sovereign Gold Bond Scheme offers an annual interest rate of 2.50% to investors.
9) The most important thing to note here is that the capital gains, if any, at maturity is tax-free. This is really an exclusive benefit available on gold bonds.
10) The payment process is very easy. It can be made through cash (up to Rs 20,000)/cheques/demand draft/electronic fund transfer.