Where things stand
The government issued Sovereign Gold Bonds (SGBs) through the RBI from 2015 to February 2024. No new tranche has been issued since, and none had been announced for 2026-27 when we last checked. Bonds already issued keep running to maturity as promised.
How an SGB works
| Feature | Detail |
|---|---|
| Unit | One gram of gold (999 purity) |
| Interest | 2.5% a year on the issue price, paid every six months |
| Tenure | 8 years |
| Early exit | After the 5th year, on an interest payment date, through the RBI |
| Price at exit | Average closing price of 999 gold for the three working days before, as published by IBJA |
| On exchanges | Listed SGBs can be bought and sold on NSE and BSE any time |
For example, the RBI fixed ₹15,384 per unit for early redemption of SGB 2020-21 Series VI on 8 September 2026. Gold's rise since 2020 made SGBs very rewarding for early holders — past returns are not a promise, though.
Can I still buy SGBs?
Yes, from other investors on the stock exchange, through your demat account. They often trade at a discount or premium to the gold price; compare the price per gram with the day's gold rate before buying, and remember the interest is 2.5% of the original issue price, not what you pay.
Tax
- Interest is taxed at your slab rate every year.
- Redemption at maturity (after 8 years) is tax-free for individuals.
- Selling on the exchange: held more than 12 months, taxed at 12.5%; less, at your slab rate.
- Check the current rules for early redemption through the RBI with a tax adviser.
Alternatives for gold
Gold ETFs and gold mutual funds track gold's price without making charges or storage worries, and you can buy them any day — but they pay no interest. Many people also hold gold jewellery; if you need money against it, compare a gold loan with a personal loan.
For general information only, not investment advice or a recommendation. Oxon Fintech is a loan facilitation platform, not a SEBI-registered investment adviser, bank or mutual fund distributor, and does not sell bonds, deposits or funds. Rates and rules are as checked on the date above; confirm with the issuer, bank or fund house before investing. Mutual fund investments are subject to market risks; read all scheme-related documents carefully.