SGB's Series 3 Offers 20% Fixed Rate In 8 Years; How To Apply For Gold Bonds At ICICI Bank's iMobile?

It's a busy week for the sovereign gold bonds (SGBs) market as RBI has launched subscriptions for the latest series-III on December 18. Subscriptions will be available till December 22nd. RBI has fixed the issue price of Rs 6,199 per gram of gold under the series-III. Here, investors will also be able to earn a rate of 2.50% per annum which is payable semi-annually on the nominal value.

However, RBI is also offering a discount of Rs 50 per gram less than the nominal value to those investors applying online and making the payment against the application through digital mode. For such investors, the issue price of a Gold Bond will be Rs 6,149 per gram of gold.

It needs to be noted that the tenure of this SGB is 8 years, and hence the total fixed rate that investors get is to the tune of 20%. There will be an option available for premature redemption after 5th year to be exercised on the date on which interest is payable.

Also, the SGBs can be used as collateral for loans. The loan-to-value (LTV) ratio will be as applicable to any ordinary gold loan, mandated by the Reserve Bank from time to time. Further, SGBs shall be eligible for trading.

The SGBs will be restricted for sale to resident individuals, HUFs, Trusts, Universities and Charitable Institutions.

As per the ICICI Bank website, here are the key benefits of Sovereign Gold Bonds:

- Hassle-free: Ownership of gold without any physical possession (No risks and no cost of storage)

- Tax treatment: The capital gains tax arising on redemption of SGB to an individual has been exempted. The indexation benefits will be provided to long-term capital gains arising to any person on transfer of bond.

- Tradability: Bonds will be tradable on stock exchanges within a fortnight of the issuance on a date as notified by the RBI.

- Transferability: Bonds shall be transferable by execution of an Instrument of transfer by the provisions of the Government Securities Act.

How To Apply For SGBs At ICICI Bank via its popular iMobile App and Internet Banking? Follow These Steps!

ICICI Bank Internet Bank:

- Login to Internet Banking> Investments & Insurance> Invest Online> Sovereign Gold Bond

iMobile:

- Login to iMobile app> Mutual Fund, Insurance & Tax Payment> Sovereign Gold Bond

ICICI Bank's FAQs stated that only a single holding mode is allowed and in case of application through a Joint account, the bond is issued in the name of the Primary Account holder.

For online application through ICICI Bank, it said that the bonds are for sale to only individuals through the Internet Banking Channel and iMobile App. Customers falling into another category of investors may however approach the branch and fill up the application form to apply for the tranche.

In the case of a minor, the application on behalf of the minor can be made by his / her guardian through a branch. Minor account holders cannot apply for SGB in the online mode.

The application form for the bonds can be availed online through ICICI Bank Internet Banking and iMobile App or branches during the subscription period.

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