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The Reserve Bank of India (RBI) has declared the premature redemption price for the Sovereign Gold Bond (SGB) 2018-19 Series-V
RBI Announces 205% Return on Sovereign Gold Bond
The Reserve Bank of India (RBI) has declared the premature redemption price for the Sovereign Gold Bond (SGB) 2018-19 Series-V, which is due for early redemption on Tuesday, July 22, 2025. While SGBs have a maturity period of eight years, investors are allowed to redeem them prematurely after five years from the date of issuance, only on coupon payment dates.
How Is the SGB Redemption Price Calculated?
According to the RBI press release dated July 21, 2025, the redemption price is determined using the simple average of the closing gold prices (999 purity) for the previous three business days prior to the redemption date. These prices are published by the India Bullion and Jewellers Association Ltd (IBJA).
What Is the Redemption Price for SGB 2018-19 Series-V?
The redemption price for the SGB 2018-19 Series-V, due on July 22, 2025, has been set at ₹9,820 per gram/unit, based on the gold price averages of July 17, 18, and 21, 2025.
Returns on Premature Redemption
The SGB 2018-19 Series-V was originally issued in January 2019 at a price of Rs 3,214 per gram. Therefore, the absolute gain on premature redemption is: Rs 9,820 (current redemption price) – Rs 3,214 (issue price) = Rs 6,606 per gram
This translates to a return of approximately 205.56%, excluding the interest component.
Interest Component on SGBs
SGBs offer a fixed interest rate of 2.50% per annum on the initial investment amount. This interest is credited semi-annually to the investor’s bank account. The final interest payment is made along with the principal at maturity or during premature redemption.
What Are Sovereign Gold Bonds (SGBs)?
SGBs are government securities denominated in grams of gold and act as a substitute for physical gold. Investors pay the issue price in cash and receive the redemption amount in cash. These bonds are issued by the RBI on behalf of the Government of India.
Previous Redemption Announcement
The RBI had earlier announced the redemption price for the SGB 2018-19 Series-IV, which was due for premature redemption on July 14, 2025.
Frequently Asked Questions (FAQs) on Sovereign Gold Bonds
Can I redeem my gold bond anytime?
No. While the bond has an 8-year maturity, early redemption is allowed only after 5 years from the issue date and only on coupon payment dates. The bonds are tradable on stock exchanges if held in demat form and can be transferred to eligible investors.
How can I exit my SGB investment prematurely?
Investors who wish to redeem early must approach the bank, SHCIL, Post Office, or agent 30 days before the coupon payment date. The request must be submitted at least one day prior to the coupon date. Proceeds will be credited to the investor’s bank account registered at the time of bond purchase.
Aparna Deb is a Subeditor and writes for the business vertical of News18.com. She has a nose for news that matters. She is inquisitive and curious about things. Among other things, financial markets, economy, a…Read More
Aparna Deb is a Subeditor and writes for the business vertical of News18.com. She has a nose for news that matters. She is inquisitive and curious about things. Among other things, financial markets, economy, a… Read More
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