The Reserve Bank of India (RBI) has announced the final redemption price for the Sovereign Gold Bond (SGB) 2017-18 Series-III, which will mature on October 16, 2025. According to an official statement by the RBI, investors will receive Rs 12,567 for each gram of gold on the redemption date. This price has been calculated using the average closing price of gold (999 purity) for October 13, 14, and 15, 2025, based on data from the India Bullion and Jewellers Association (IBJA).
The bonds were originally issued on October 16, 2017, at Rs 2,866 per gram. This means investors will make a gain of about Rs 9,701 per gram, giving an absolute return of nearly 338% over eight years. And that’s excluding the 2.5% annual interest that investors have also earned every year.
What is the Sovereign Gold Bonds scheme?
SGB Scheme was introduced by the Indian government in November, 2025 as an alternative to attract gold ownership. The bonds were issued by the RBI for and on behalf of the Centre. The bonds denominated in grams of gold offered investors dual benefit-- earning a fixed annual interest of 2.5% on the issue price and earning capital appreciation linked to gold prices. The scheme majorly aimed to reduce India’s reliability on imported physical gold, curb hoarding, and channel household savings into financial assets.
The bonds have a fixed term of eight years, but investors can exit after five years on interest payment dates if they wish. SGBs can also be traded on stock exchanges, transferred to others, or used as collateral for loans.
How will redemption work?
Investors get a reminder about a month before the bond matures. On the maturity date, the money will be automatically credited to their registered bank account. Those who’ve changed their bank details or email must update the information with their bank, SHCIL, or post office beforehand.
With gold prices at record highs, investors in this SGB series are set to enjoy one of the most rewarding payoffs since the scheme began.
What is the tax treatment of Sovereign Gold Bonds
As per the provisions of the Income-tax Act, 1961 (Section 43 of 1961) the interest on the SGBs is taxable. When an individual redeems these bonds, they are free from paying capital gains tax. Any capital gains that result from the transfer of the bonds on the exchange will be eligible for the indexation benefits.
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