All about Sovereign Gold Bond.
                     All about Sovereign 
Gold Bond
What is SBG?
• SGBs are Gold-denominated government securities. They are alternatives to 
keep actual gold. 
• Investors will pay the issue price in cash, and the bonds will be repaid on 
maturity in cash. Reserve Bank issues the Bond on behalf of Government of 
India. 
Benefits
• The SGB provides a superior physical alternative to keeping gold. 
Security risks and storage costs are reduced. 
• At maturity and periodic interest, investors are assured of the market 
value of the gold. In the case of gold in jewellery form, SGB is exempt 
from issues such as making charges and purity. 
• The bonds are kept in RBI books or in demat form reducing the 
possibility of scrip loss etc.
Risks
• A risk of capital loss can occur when the gold market price declines. 
The investor will not lose however in terms of the gold units he has 
paid for. 
Eligibility
• Indian residents as specified by the Foreign Exchange Management 
Act, 1999 are entitled to invest in SGBs. Investors who are eligible 
include individuals, HUFs, trusts, colleges and charities. 
• Individual investors with subsequent change in residential status can 
continue to hold SGB until early redemption / maturity.
Application Form
• Emitting banks / SHCIL offices / designated post offices / agents must 
have the application form. It's also available for download from the RBI 
website. Banks can also have request facilities online. 
• A customer can apply online via the scheduled commercial banks 
mentioned web site. 
Unique ID
• An investor can only have one specific investor ID linked to any of the 
specified identification documents. 
• Of all future investments in the scheme, the exclusive investor ID 
shall be used. Quoting of PAN in the application form is mandatory 
for holding securities in dematerialized form.
Limits
• The Bonds are given in one gram of gold denominations and in multiples of those. 
• Minimum investment in the Bond shall be one gram for individuals with a fixed 
subscription limit of 4 kg, 4 kg for the Hindu Undivided Family (HUF) and 20 kg for 
trusts and related entities approved by the Government from time to time by fiscal 
year (April – March). 
Joint Holding
• The cap shall extend to the first claimant in the case of a joint 
possession. 
• The annual limit will include bonds issued by Government and those 
bought from the secondary market under separate tranches during 
initial issuance.
Authorized Agencies
• Bonds are sold either directly or through their agents through offices or 
branches of Nationalized Banks, Scheduled Private Banks, Scheduled 
International Banks, Approved Post Offices, Stock Holding Company of 
India Ltd. (SHCIL), and permitted stock exchanges. 
Premature Redemption
• Since the tenor of the bond is 8 years, early encashment / redeeming of 
the bond is allowed on coupon payment dates after the fifth year from the 
date of issue. 
• The bond, if kept in demat form, will be tradable on the Exchanges. It can 
also be forwarded to any other qualifying investor.