What is a Sovereign Gold Bond and How to Buy Sovereign Gold Bond From SBI?

As part of the Gold Monetisation Scheme, the government launched the Sovereign Gold Bond Scheme in November 2015. The RBI, in consultation with the GOI, opens the scheme's issues for subscription in tranches. The Sovereign Gold Bond (SGB) Scheme 2021-22 - Series X subscription period began on Monday, February 28, 2022, and will end on March 4, 2022. The Reserve Bank of India has set gold's price at Rs 5,109 per gramme (RBI). You will receive a Rs 50 discount if you apply online. Here is how you can buy a sovereign gold bond from SBI.

What is a Sovereign Gold Bond (SGB)?

Sovereign gold bonds are RBI-mandated certificates issued in exchange for grams of gold, allowing individuals to invest in gold without worrying about the safety of their physical asset. Because gold prices are less volatile, individuals prefer sovereign gold bonds as a safe investment vehicle.

Features-

• The Bond will have an 8-year term with exit options in the fifth, sixth, and seventh years that can be exercised on interest payment dates.
• In the case of joint ownership, the investment limit of 4 KG will be applied only to the first applicant.
• Under the Government Security Act of 2006, the gold bonds will be issued as Government of India stocks.The Bonds are eligible for Demat form.
• The redemption price will be in Indian rupees based on the simple average of the previous three working days' closing prices of gold of 999 purity published by IBJA.
• The investors will be compensated at a fixed rate of 2.50 percent per year on the nominal value, payable semi-annually.

Benefits

• The SGB is a better investment than physical gold.
• Storage risks and costs are reduced.
• SGB is free of issues like making charges and purity in the case of gold in jewellery.
• The bonds are held on the books of the RBI or in demat form, eliminating the risk of scrip loss, etc.

Who is eligible to invest in the SGBs?

SGB may be invested in by persons residing in India as defined by the Foreign Exchange Management Act of 1999. Individuals, HUFs, trusts, universities, and charitable organisations can all invest.

How to register for a Sovereign Gold Bond?

Step 1: Login to SBI Net Banking with your credentials.

Step 2: Select 'e-service' from the main menu
Step 3: Now, go to the 'Sovereign Gold Bond Scheme' page
Step 4: Choose 'Register', select 'Terms and Conditions,' and Now , 'Proceed.'
Step 5: Fill the registration form with required details
Step 6: Select a Depository Participant, enter the DP ID and Client ID, finally click the 'Submit' button.

How to buy Sovereign Gold Bond scheme from SBI?

Step 1: Login to your SBI Net Banking with your login credentials.

Step 2: Select 'e-service' from the main menu.
Step 3: Now, go to the 'Sovereign Gold Bond Scheme' page.
Step 4: Select the 'Terms and Conditions' and click proceed
Step 5: Enter the 'Subscription quantity' and nominee details.
Step 6: click on the 'Submit' button.
Step 7: Enter OTP received and click the 'Confirm' button.