The fifth tranche of Sovereign Gold Bonds has been priced at Rs 3,150 per gram of gold. The rate has been fixed the Reserve Bank of India on the basis of simple average of closing price for gold of 999 purity of the previous week (August 22-26, 2016) published by the India Bullion and Jewellers Association Ltd (IBJA).
Gold of 999 purity closed at 31,255 per 10 grams on August 30 as per IBJA data.
The 5 tranche of Sovereign Gold Bonds will be open for subscription from September 1-9.
The issue price of the fourth tranche was fixed at Rs 3,119 per gram of gold based on the simple average of the closing prices of gold of 999 purity for the week July 11-15, 2016 as IBJA.
The fourth tranche of the Sovereign Gold Bond Scheme collected a record Rs.919 crore, equivalent to 2.95 tonnes of gold. The total amount raised in the four tranches was around Rs 2,240 crore.
The gold bonds are fully secure and can be used as collateral for loans. The bonds are exempt from capital gains tax exemption on redemption and has zero risk of theft. The bonds are also tradeable through stock exchanges and can be available in demat and physical paper form.
SGBs earn an interest rate of 2.75 per cent per annum, payable half yearly.
Under the fourth tranche the government reduced the minimum subscription limit to 1 gm against the previous 2 gm. It also exempted the redemption of the bonds from capital gains tax, a provision that was extended to the previous three tranches as well.
The first three tranches of the scheme collected Rs.1,318 crore corresponding to 4.9 tonnes (4,900 kg) of gold, with the second tranche holding the previous record of highest subscription amount of Rs.746 crore for 2.95 tonnes of gold.