Indians love Gold and the idea is to give an alternative to investors who invest in Physical Gold. The scheme has been approved by the cabinet committee.
Sovereign Gold Bond Scheme's Salient Features are
1. The GOLD bonds would be denominated in grams of gold and can be bought by paying in rupees.
2. The gold bond will have denominations of 5, 10, 50, 100 grams of gold.
3. The Sovereign Gold bonds will be backed by GoI against default
4. Only resident Indians would be able to invest.
5. NRIs (Non-Resident Indians) would not be eligible to invest.
6. The Sovereign Gold bonds would be distributed or sold by Banks, Post Offices, NBFCs (Non Banking Fiance Companies) and other intermediaries.
7. RBI (Reserve Bank of India) would issue these bonds on behalf of Government of India.
8. An individual can invest maximum of 500 grams of gold bonds in one year (About Rs. 13 Lakhs).
9. KYC needs to be followed for investment above certain limit.
10. The interest rate on these bonds would be decided by Government of India depending on market conditions.
11. The tenor of the bonds would be 5 years, 7 years.
12. Loan would be available against these Gold Bonds. The Loan to Value would be same as applicable to Gold and determined by Reserve Bank of India (RBI) from time to time.
13. Gold Bonds would be issued in both demat (dematerialized) Form and paper form.
13. The demat gold bonds can be traded on stock exchanges.
14. The capital gains on selling on these gold bonds would be same as in case of Gold.
15. On maturity the redemption would be in rupee only.
16. The interest would be calculated on the value of gold at the time of investment.
17. At maturity, the principal amount would be redeemed at the prevailing rate of gold at the time of maturity.
18. If the price of gold has fallen from investment to maturity, the investors can roll over the gold bonds for 3 or / more years.
Official Press Release
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