Sovereign Gold Bonds Explained & How to Invest?

What are Sovereign Gold Bonds?

Want to learn about Sovereign Gold Bonds? Do check out this article from Groww Blog to get an idea: Sovereign Gold Bonds - Features and Advantages of Sovereign Gold Bond (

This part was written by Priyanshu Ranjan on 23rd August 2020 in our FinTalks Facebook Group.

The bonds will get credited into your account by the issuance date.


  1. One can buy 1 gm to 4 kg of Gold per issue.
  2. The government pays 2.5% per annum of interest on your invested value into your bank account.
  3. The maturity period is 8 years. But one can redeem the bond after the completion of 5 years. If redeemed after 5 years, capital gains are fully exempted. On redemption, you will get the value of gold as per market price.
  4. There is an option of early exit (redemption before 5 years). Early exit can be made by selling those bonds through a demat account on NSE. These bonds are traded on NSE/BSE (though the liquidity is low).


  1. Extra income of 2.5% pa along with gold appreciation value
  2. Government guarantee
  3. No tax on capital gains
  4. Best way to invest in gold for a long period
  5. Net returns are higher than actual gold returns
  6. Loan against SGB is also available

Attaching last 5yrs return (July 2015 - July 2020) from different Gold Investment Instruments:

How to Invest in Sovereign Gold Bonds?

Check out this article: How to Invest or Buy Sovereign Gold Bonds Online (

In short, you can invest in SGB via the net-banking facility of your bank. SGB application forms generally ask for your name, address, guardian’s name in case you are a minor, PAN number, and so on and so forth. If you are already KYC verified with your bank, these details may be auto-filled.

You can also follow this thread on our FinTalks Facebook Group here and here.

Thank you for reading. Don’t forget to join our FinTalks Facebook Group & FinTalks Telegram Channel for regular updates on banking and finance.