Second tranche of the Sovereign Gold Bonds to be kept open from Jan 18-22, 2016
Jaitley said this while addressing the heads of banks through a conferencing on Jan 14. He also discussed the banks’ preparedness for the second tranche of the Sovereign Gold Bond Scheme.
He said that this is an attractive opportunity for the investors.
All the banks assured to activate their branch network to inform the investors about the advantages of the bonds.
The First Tranche of Sovereign Gold Bond (SGB) was issued on behalf of the Government of India by the Reserve Bank of India (RBI) at the branches of scheduled commercial banks and designated post offices through its e-kuber system from Nov 5 to 20, 2015 . A total of 62,169 applications were received for a total subscription of 915.953 Kilograms of gold amounting to Rs 246.20 crore by the banks and post offices.
The main objectives of the Sovereign Gold Bond scheme is to reduce the demand for physical gold and shift a part of the gold imported every year for investment purposes into financial savings through Gold Bonds.
Sovereign Gold Bonds are issued by the RBI on behalf of the Government of India on payment of the required amount in rupees and are denominated in grams of gold.
The Bonds are restricted for sale to resident Indian entities including individuals, HUFs, trusts, Universities, charitable institutions.
Minimum permissible investment is 2 grams of gold to be paid in rupees. The maximum amount subscribed by an entity will not be more than 500 grams per person per fiscal year (April-March).
Government has fixed the rate of interest for the year 2015-16 as 2.75 % per annum, payable on a half-yearly basis.
The bonds will be available both in demat and paper form. These bonds will be available at banks and post offices.
The rate for the Bonds will be fixed on the basis of simple average of closing price for gold of 999 purity of the previous week published by the India Bullion and Jewellers Association (IBJA).
The tenor of the Bond will be for a period of 8 years with exit option from fifth year onwards to be exercised on the interest payment dates.
KYC norms will be the same as that for gold.
Exemption from capital gains tax will also be available.
On maturity, the investor will get the equivalent rupee value of the quantum of gold invested at the then prevailing price of gold.
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