Sovereign Gold Bond 2023-24 Series III: Here's How To Buy SGBs Via Paytm Money

Investing in sovereign gold bonds is directly available through the Paytm Money app. These government-backed bonds offer gold price stability with guaranteed interest, making them an attractive option for investors. That being said, Paytm Money offers a seamless and convenient platform to invest in SGBs. This week, a new series of sovereign gold bonds is being launched, while another series is lined up next year in February month.

Notably, SGBs are issued by the Reserve Bank of India (RBI) in tranches throughout the year. Each bond has a fixed tenor of 8 years, with an option to exit prematurely after the 5th year. The issue price of SGBs is linked to the prevailing gold price, and investors receive an additional 2.5% annual interest, payable semi-annually.

RBI has allowed subscriptions in SGB Series III for the fiscal year 2023-2024 since December 18, which will end on December 22, 2023. The RBI has established the issue price for SGBs 2023-24 Series III at Rs 6,199 per gram, with a discount of Rs 50 per gram accessible for online subscribers.

Here's how to buy SGBs on Paytm Money:

- Go to the Paytm Money app, and then click on the SGB tab at the top
- On the next page, click on 'Continue to apply'
- On the following page, click on 'Apply Now', and select the quantity you wish to buy

In case KYC is incomplete, a page will pop up to guide on 'How to complete KYC', which gets processed in 2-3 days.

- In case there's no money in the Paytm Money app, then click on 'add money'
- Once the money is added, select the quantity and click on buy
- Funds will be blocked post application submission (during market hours)
- SGB application will be sent to the exchange on the same day at 4 PM.

SGBs are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity.

As per RBI guidelines, there may be a risk of capital loss if the market price of gold declines. However, the investor does not lose in terms of the units of gold which he has paid for.

Among the eligibles are, persons resident in India as defined under the Foreign Exchange Management Act, 1999 are eligible to invest in SGB. Eligible investors include individuals, HUFs, trusts, universities and charitable institutions. Individual investors with subsequent change in residential status from resident to non-resident may continue to hold SGB till early redemption/maturity.

The tenure for holding SGBs is eight years, with the facility of premature withdrawal after 5 years from the date of purchase. On maturity, the Gold Bonds shall be redeemed in Indian Rupees and the redemption price shall be based on a simple average of the closing price of gold of 999 purity of the previous 3 business days from the date of repayment, published by the India Bullion and Jewelers Association Limited. Both interest and redemption proceeds will be credited to the bank account furnished by the customer at the time of buying the bond.