2nd tranche of sovereign gold bonds open today: All you need to know

The SGB for the current financial year is issued in six tranches. The first tranche of subscriptions was opened from May 17-May 21.

As the second tranche of the Sovereign Gold Bond (SGB) scheme 2021-22 opens on May 24, the Reserve Bank of India (RBI) will issue the bonds on behalf of the Government of India.

The central bank announced the issue price for the second tranche of such bonds pegging a gram of gold at Rs 4,842. Further, the Government of India, in consultation with the RBI, has decided to allow a discount of Rs 50 per gram from the issue price to those investors who apply online and the payment is made through digital mode.

For such investors, the issue price of SGB will be Rs 4,792 per gram of gold.

SGBs bear interest at the rate of 2.50 percent (fixed rate) per annum on the amount of initial investment. The interest is credited semi-annually in the bank account of the investor and the last interest is payable on maturity along with the principal.

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

>What is the subscription period for the second tranche? The subscription for the second tranche of SGBs is open from May 24–28, 2021.

>What is the issue date? The issue date for these bonds is June 1, 2021.

The minimum investment in the SGBs is one gram and the maximum limit of subscription of 4 kg for individuals and Hindu Undivided Family (HUF). The limit is increased to 20 kg for trusts and similar entities notified by the government from time to time per fiscal year. In the case of joint holding, the limit applies to the first applicant.

You can purchase SGBs through banks (except small finance banks and payment banks), designated post offices, Stock Holding Corporation of India Ltd (SHCIL), National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).

Any person resident in India can apply for SGBs.

>What is the schedule for the next tranche? The SGB for the current financial year is issued in six tranches. The first tranche of subscriptions was opened from May 17-May 21.

Refer to the schedule below as per RBI: