Groww Logo
Home>Blog>Gold>How to Buy Sovereign Gold Bonds

How to Buy Sovereign Gold Bonds

16 November 2021

The RBI issues sovereign gold bonds (SGBs) on behalf of the Government of India, and they are a preferred investment instrument as they are backed by the government. Moreover, investing in a sovereign gold bond is a suitable alternative to an investment in physical gold. 

With transactions taking place digitally, investing in SGBs has become easy and effortless over the years. This article, therefore, elaborates on how to buy gold bonds online in India.

How to Buy Sovereign Gold Bonds Online? 

There are several banks that give you the option of investing in SGBs via the netbanking option and the steps to do the same are mostly similar. We have written about the steps to buy SGB on SBI just as an example. 

Individuals can follow these steps to know how to buy gold bonds online SBI – 

Step 1: First and foremost, investors should log in to their net banking account with the State Bank of India or SBI.

Step 2: Then, they need to choose the ‘eServices’ option and select ‘Sovereign Gold Bond’.

Step 3: At this point, investors must read the terms and conditions, which are laid out by the Reserve Bank of India. When well-versed with these terms and conditions, select the option ‘proceed’.

Step 4: Now, investors are required to fill out a registration form and click on ‘Submit’.

Step 5: Thereafter, one needs to put in the quantity of subscription in a purchase form, alongside his/her nominee details.

Step 6: After furnishing these details, select the option ‘Submit’.

Who Is Eligible to Invest in a Sovereign Gold Bond Scheme 2020 21?

The Reserve Bank of India allows the following entities to buy RBI gold bonds online:

  • Resident individuals of India
  • A Hindu undivided Family (HUF)
  • Individuals subscribing on a minor’s behalf
  • Charitable organisations, trusts, and universities

Besides eligibility, you should also be aware of the vital dates associated with it.

Important Dates of Sovereign Gold Bond Upcoming Issues

The Government of India and RBI issue sovereign gold bonds in several tranches in a financial year. For instance, SGBs were issued in 6 tranches from May to September in 2021, and in the following manner:

Tranche Subscription Date Issue Date
Series I 17th-21st May 2021 25th May 2021
Series II 24th-28th  May 2021 1st June 2021
Series III 31st May-4th June 2021 8th June 2021
Series IV 12th-16th July 2021 20th July 2021
Series V 9th-13th August 2021 17th August 2021
Series VI 30th August – 3rd September 2021 7th September 2021

Likewise, sovereign gold bond upcoming issues will take place in 4 tranches and as per the calendar specified below:

Tranche Subscription Date Issue Date
Series VII 25th-29th October 2021 2nd November 2021
Series VIII 29th November-3rd December 2021 7th December 2021
Series IX 10th-14th January 2022 18th January 2022
Series X 28th February-4th March 2022 8th March 2022

What Is the Sovereign Gold Bond Rate Today?

Sovereign gold bonds bear a fixed interest rate of 2.50% per annum on the initial investment amount. Moreover, the interest is credited on a semi-annual basis to an investor’s bank account. The last interest is payable on maturity, alongside the principal.

What Are the Minimum and Maximum Limits for Investing in SGBs?

The RBI issues sovereign gold bonds in denominations of 1 gram and in its multiples thereof. When planning to buy gold bonds online in India, investors should make a minimum investment of 1 gram (source). 

The maximum limit for investing in a sovereign gold bond SBI is as follows:

  • 4 kilograms for individual investors
  • 4 kilograms for Hindu undivided families
  • 20 kilograms for trusts (or similar institutions as notified by the Government of India in a fiscal year)

Furthermore, the investment limit of 4 kilograms is applied only to the first holder in case of joint holding.

Is It Mandatory to Purchase Gold Bonds Online?

Prospective investors should note that the RBI allows one to invest in SGBs via offline routes as well. For this, investors can buy sovereign gold bonds from any of the following entities:

  • Designated post offices
  • The Stock Holding Corporation of India Limited or SHCIL
  • Recognised stock exchanges of India viz., the National Stock Exchange of India Limited and the Bombay Stock Exchange Limited
  • Scheduled commercial banks, namely:

Private Banks

  1. Karur Vysya Bank Ltd.
  2. Axis Bank Ltd.
  3. IndusInd Bank Ltd.
  4. Nainital Bank Ltd. 
  5. HDFC Bank Ltd.
  6. Tamilnad Mercantile Bank Ltd.
  7. Development Credit Bank Ltd.
  8. IDBI Bank Ltd.
  9. City Union Bank Ltd.
  10. IDFC Bank Ltd. 
  11. Ratnakar Bank Ltd.
  12. Federal Bank Ltd.
  13. Jammu & Kashmir Bank Ltd. 
  14. Dhanlaxmi Bank Ltd.
  15. South Indian Bank Ltd. 
  16. Development Credit Bank Ltd
  17. Bandhan Bank 
  18. ICICI Bank Ltd.
  19. Karnataka Bank Ltd.
  20. Kotak Mahindra Bank Ltd.
  21. Yes Bank Ltd. 
  22. Lakshmi Vilas Bank Ltd.
  23. Catholic Syrian Bank Ltd.

Public Banks

  1. State Bank of India 
  2. Bank of Maharashtra 
  3. Indian Overseas Bank 
  4. Bank of Baroda (including Dena Bank and Vijaya Bank)
  5. Bank of India 
  6. Canara Bank (including Syndicate Bank)
  7. Punjab National Bank (including United Bank of India and Oriental Bank of Commerce)
  8. Union Bank of India (including Corporation Bank and Andhra Bank)
  9. Punjab & Sind Bank
  10. UCO Bank
  11. Central Bank of India 
  12. Indian Bank (including Allahabad Bank)

Additionally, when researching how to buy gold bonds online in India, prospective investors must note that this investment instrument is well-suited for those with a long-term investment horizon. Moreover, gold investments tend to perform well when other asset classes, like equity, fare poorly, thereby acting as a hedge against other assets’ underperformance. So, risk-averse investors seeking stable returns, in the long run, can consider investing in SGBs.

Do you like this edition?
LEAVE A FEEDBACK
ⓒ 2016-2022 Groww. All rights reserved, Built with in India
MOST POPULAR ON GROWWVERSION - 3.1.1
STOCK MARKET INDICES:  S&P BSE SENSEX |  S&P BSE 100 |  NIFTY 100 |  NIFTY 50 |  NIFTY MIDCAP 100 |  NIFTY BANK |  NIFTY NEXT 50
MUTUAL FUNDS COMPANIES:  ICICI PRUDENTIAL |  HDFC |  NIPPON INDIA |  ADITYA BIRLA SUN LIFE |  SBI |  UTI |  FRANKLIN TEMPLETON |  KOTAK MAHINDRA |  IDFC |  DSP |  AXIS |  TATA |  L&T |  SUNDARAM |  PGIM |  INVESCO |  LIC |  JM FINANCIAL |  BARODA PIONEER |  CANARA ROBECO |  HSBC |  IDBI |  INDIABULLS |  MOTILAL OSWAL |  BNP PARIBAS |  MIRAE ASSET |  PRINCIPAL |  BOI AXA |  UNION KBC |  TAURUS |  EDELWEISS |  NAVI |  MAHINDRA |  QUANTUM |  PPFAS |  IIFL |  Quant |  SHRIRAM |  SAHARA |  ITI