For the new SGB series that opens for public subscription on October 15, the government has fixed the rate at Rs 3,146 for a gram of gold. Further in consultation with the RBI, it has allowed a discount of Rs. 50 per gram from the issue price to those customers who apply for the SGBs online and the payment is made via digital transaction. The finance ministry release said that for this set of investors, SGBs will be priced at Rs. 3,096 per gram.
The SGBs for the FY19 series will be launched in 5 tranches each month from October-February 2019. The first tranche of SGBs will remain open from October 15- October 19, while the bonds will be issued on October 23.
Further as per the specified calendar, the next tranche will be launched between November 5-9 and bond issuance will be made on November 13. In the month of December, SGBs for subscription will be available between December 24-28 and the bonds will be issued on January 1, 2019.
The next tranche in January will open for subscription between January 14-18 and the issuance of bonds will be on January 22. The final subscription shall be available from February 4-8 and bonds will be issued on February 12.
The scheme offers benefits similar to the earlier tranche of 2.5% interest and exemption on capital gains tax on redemption.
The government launched the SGB scheme in November 2015 to channelize a part of domestic savings, used for purchasing physical gold, to financial savings and thus lower the demand for the precious yellow-metal.
Under the scheme, the bonds are denominated in units of one gram of gold and multiples thereof. Minimum investment is one gram with a maximum subscription limit of 500 grams per individual in a fiscal year.
The maximum subscription limit is 4 kg for individuals and HUF and 20 kg in case of trusts and similar entities per fiscal (April-March). The tenor of the bond will be for a period of eight years with exit option in the fifth, sixth and seventh year.
The bonds will be sold by banks, designated post office branches, NSE, BSE and the Stock Holding Corporation of India Limited (SHCIL).
With PTI Inputs