What are Sovereign Gold Bonds?
Sovereign Gold Bonds (SGBs) are government-issued debt securities that offer investors a way to gain exposure to gold without holding it in physical form. These bonds are denominated in grams of gold and offer a dual benefit—capital appreciation linked to gold prices and a fixed annual interest payout.
Key features of SGBs
- Issuer: Government of India through the Reserve Bank of India (RBI)
- Denomination: In grams of gold
- Tenure: 8 years (with early exit allowed after 5 years)
- Interest: 2.5% per annum (paid semi-annually)
- Redemption: Cash settlement at market value on maturity
- Risk level: Virtually no credit risk, as they are sovereign-backed
SGBs eliminate the risks and costs associated with storing physical gold, and they provide returns that match market gold prices along with fixed interest.
What if...
| Scenario | Resolution |
|---|
| You need liquidity before 5 years | You can sell your SGBs in the secondary market via FYERS. |
| You want physical gold instead | SGBs cannot be redeemed in physical form. Consider gold ETFs or buying gold directly. |
Use the FYERS SGB portal to view upcoming issues and place applications easily. A step-by-step guide is available for your reference. Last updated: 26 Jun 2025
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