Bond with the best

Dec 03 2013, 09:52 IST
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To protect households against negative returns on their savings, the Reserve Bank of India will launch retail inflation-index bonds in mid December. To protect households against negative returns on their savings, the Reserve Bank of India will launch retail inflation-index bonds in mid December.
SummaryNew retail inflation-linked bonds will be a lucrative option for household investors.

investors and get them inflation-protected returns in the long run.

Safety gear

* RBI will launch retail inflation-index bonds in mid December. Investors can buy these from banks

* These bonds will offer households a shield against negative returns on their savings

* The 10-year bonds will have a face value of R5,000

* Investment in the bonds has been capped at R5 lakh per applicant per year

* Interest on these securities would be based on the CPI with a three-month lag

* Quoting PAN is mandatory if the investment amount is more than R50,000 per year

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