Gold investors rejoice! The RBI has officially opened the exit door for Sovereign Gold Bond 2020-21 Series VII, enabling premature redemption from today. Launched five years ago, this series promises eye-popping returns for patient holders.
Priced at ₹15,254 per gram equivalent for redemption, the value reflects recent gold market averages from IBJA data. Compared to the initial issue price of ₹5,051, early redeemers stand to pocket approximately 205% returns, excluding the additional 2.5% yearly interest disbursed twice annually.
Issued on October 20, 2020, these bonds were designed for an eight-year tenure with an early exit option post-five years. This feature has proven popular, offering liquidity without the hassles of physical gold storage or purity concerns.
Practical steps are straightforward: Visit your purchase point—be it a bank, designated agency, or post office—to file the redemption request. Funds hit your account automatically on redemption day, streamlining the process.
On taxes, full-term holders who bought directly from the issuer get a clean slate on capital gains. Early or secondary market redemptions trigger taxes—long-term if over a year, or income slab rates otherwise. Interest is always taxable per your bracket.
As gold prices hover high, this redemption window could prompt a wave of exits, highlighting SGBs as a smart hedge against inflation and currency risks.
