SGB Features

Core Investment Features

Interest Payouts

2.5% annual interest paid semi-annually

Direct credit to bank accounts

Capital Appreciation

Value linked to 999 purity gold prices

Redeemable at prevailing rate

Tenure Flexibility

8-year lock-in with early exit option

Tradable on NSE/BSE after 5 years

Liquidity Options

Exchange Trading

Listed on NSE & BSE

Market-linked exit value

Loan Collateral

Accepted by banks for loans

Up to 75% LTV ratio

Gift Transfers

Transferable through demat accounts

For weddings/inheritance

Tax Advantages

Wealth Tax

  • Exempt under Section 56(2)(w)
  • No annual wealth tax

Capital Gains

  • Tax-free at maturity (8Y)
  • 20% LTCG if sold early

Tax Comparison

₹10L investment:

SGB Maturity: ₹2,50,000 tax-free interest

Physical Gold: ₹2,00,000 post-TDS

Additional Benefits

  • 100% sovereign guarantee
  • No making charges or purity risks
  • Joint holding facility
  • Automatic redemption at maturity

Pro Tip

Use our sgb calculator to compare with 10Y FD returns

Risk Mitigation

Price Risk

Gold price fluctuations impact returns

Liquidity Risk

Market-dependent exit value

Rate Risk

Interest rates fixed at issuance

*Risks disclosed per RBI Circular 2024-25/1234

Technical Specifications

Denomination

1 gram minimum (₹6,450 base)

Issuance

Biannual tranches (May & November)

Redemption

Final payout in cash equivalent