This Article is From Oct 28, 2021

Sovereign Gold Bonds 2021-22: Subscription For 7th Tranche Ends Soon, Should You Buy?

Sovereign Gold Bond Scheme 2021-22: Subscribers can earn interest and avail additional returns on their investment in gold bonds, the current series of which is open till October 29

Sovereign Gold Bonds 2021-22: Subscription For 7th Tranche Ends Soon, Should You Buy?

Sovereign Gold Bonds are available at an issue price of ₹ 4,765 per unit

Sovereign Gold Bond 2021-22: The seventh tranche of the government-run sovereign gold bond scheme will close for subscription on Friday, October 29. An issue price of Rs 4,765 per unit, equivalent to the value of one gram of gold, is applicable for the seventh installment of the gold bond scheme 2021-22, according to the Reserve Bank of India (RBI). The date of issuance for the tranche is set as November 2, 2021. (Also Read: What Are Sovereign Gold Bonds? Here's All You Need To Know )

The state-run gold bond scheme - on behalf of the RBI, has become a popular means to invest the yellow metal in a non-physical form, especially amid the COVID-19 pandemic, according to experts. The seventh tranche window opened for investors on October 25 and ends on Friday- remaining open for a period of five days, as per the schedule set for the gold bond scheme 2021-22.

Gold bonds are considered to be a safe bet for investment and are linked to the market price of the precious metal. After the current series, the gold bond scheme will be available for subscription for three more tranches in the current fiscal. The interest-paying gold bonds can also be used as collateral for loans. (Also Read: Gold Bond Series VII-X- Key Things To Know )

Sovereign Gold Bonds 2021-22 Series VII: October 25 - October 29: Here's All You Need To Know

Should You Buy?

“The price for the sovereign gold bond tranche-7 has been fixed at 4761/gm. The gold bonds by the government have been a big success, as the government has raised over Rs 32,000 crores since its inception in 2015. SGBs are a superior option to invest in gold without having to worry about its storage cost, making charges in the case of gold jewelry.

SGB comes with an advantage due to tax benefits and regular interest payout for the investors. The investment in SGBs has helped the government reduce the deficit, also formalized the investment in Gold in the country.

The gold prices have strengthened despite a rise in the US bond yield and its impact on the USD. Moving forward gold prices will be guided by the development from the trade talks between the US and China, the new COVID19 variant in China, and its impact on business activities and central banks' action on liquidity and rate hike front,'' said Mr. Nish Bhatt, Founder and CEO, Millwood Kane International - an investment consulting firm. 

Discount For Online Subscribers

For all those who are investing in the gold bonds scheme online - in which the payment is done through any of the digital methods, a discount of Rs 50 per unit is applicable, according to the RBI. For the online subscribers, the issue price is set at Rs 4,715 per gram of gold in the seventh tranche of the sovereign gold bonds scheme.

How To Invest In Sovereign Gold Bonds

The sovereign gold bonds are sold through the scheduled commercial banks (except small finance banks and payment banks), stock holding corporation of India Limited (SHCIL), Clearing Corporation of India Limited (CCIL), designated post offices, as well as the recognised stock exchanges - National Stock Exchange of India and the Bombay Stock Exchange Limited. The gold bonds are held in the RBI books or in a demat form. 

The process for purchasing gold bonds is similar to that of the gold exchange-traded funds (ETFs) through a stock exchange. Once the whole transaction is complete, the bonds are transferred to the buyer's account in a demat form, according to the RBI.