What are Gold Bonds?

1 min read
What are Gold Bonds? Blog Image


RBI has announced the Sovereign Gold Bond Scheme 2022-23 - Series III, which will be open for subscription from December 19 to December 23.

About Gold Bonds:

  • Gold bonds 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.
  • The bond is issued by the RBI on behalf of the government.
  • These bonds offer a superior alternative to holding gold in physical form.
  • The risks and costs of storage are eliminated.
  • Investors are assured of the market value of gold at the time of maturity and periodical interest.
  • It’s free from issues like making charges and purity in the case of gold in jewellery form.
  • The bonds are held in the books of the RBI or in demat form eliminating risk of loss.
  • While the tenor of bonds is eight years, it can be redeemed after five years.


Q1) When was the Sovereign gold bond scheme launched?

The Government of India introduced the Sovereign Gold Bond (SGB) Scheme in November 2015, to offer investors an alternative to physical gold.

Source: Indian Express