The Reserve Bank of India (RBI) has set the redemption price for Sovereign Gold Bond (SGB) Series IV of 2016-17, due on September 17, 2024. The premature redemption rate is ₹7,196 per unit.

This represents a profit of ₹4,303 per unit, which is approximately 149% above the original issue price.

Originally issued at ₹2,893 per unit, the redemption price is calculated based on the average closing gold price of 999 purity over the preceding five business days.

For this period, the average is derived from September 9 to September 13, 2024, as reported by the India Bullion and Jewellers Association Ltd (IBJA).

How to initiate premature redemption

To redeem bonds prematurely, investors need to contact their bank, Stock Holding Corporation of India (SHCIL) office, post office, or agent at least 30 days before the coupon payment date.

However, the redemption request must be submitted at least one day before the coupon payment date to comply with RBI guidelines.

Upon successful redemption, proceeds are directly deposited into the bank account specified during the bond application process, ensuring a smooth withdrawal process.

About Sovereign Gold Bonds

Sovereign Gold Bonds are a Government of India product under the Government Securities Act, 2006.

They offer a convenient way to invest in gold without dealing with physical gold. Investors receive a Certificate of Holding upon subscription, and bonds can also be converted into demat form.