RBI Announces Premature Redemption For Sovereign Gold Bonds Issued From May 2017 To March 2020

The Reserve Bank of India has announced the premature redemption dates for Sovereign Gold Bonds issued between May 2017 and May 2020. To provide early liquidity options, the RBI plans to redeem 30 SGBs between Oct. 11, 2024, and March 1, 2025.

The redemption price will be based on the average gold prices from the three business days preceding the maturity date. Investors can submit redemption requests during a 20-day window before each bond's maturity, with the redemption amount and accrued interest credited to their accounts within 10 days of submission.

As per RBI guidelines, investors can request premature redemption after holding the bonds for five years from the issue date. Redemption requests should be submitted within the designated windows through Receiving Offices, National Securities Depository Ltd., Central Depository Services Ltd., or RBI Retail Direct.

The first redemption period will begin on Oct. 11, 2024, for SGBs issued on May 12, 2017, closing on Nov. 2, 2024, with payments scheduled for Nov. 12, 2024.

Price of 24 karat gold stood at Rs 7,124 per gram on Aug. 24. Investors can redeem their bonds in cash or physical gold.

SGBs are government-backed securities priced in grams of gold, providing a cash alternative to physical gold ownership. Investors purchase these bonds at an issue price and receive cash upon maturity. Issued by the RBI on behalf of the Government of India, these bonds offer a hassle-free investment in gold.