Sovereign Gold Bond (SGB) 2025: Upcoming Issue, Premature Redemption, Interest Rate & Issue Date

Sovereign Gold Bonds (SGBs) are government-backed securities issued by the Reserve Bank of India (RBI) as an alternative to physical gold. They eliminate storage concerns, offer assured annual interest, and provide tax-free capital gains at maturity. No new SGB tranches have been announced for FY 2024–25 or 2025, as per the latest updates.

Key Highlights

• Sovereign Gold Bonds (SGBs) offer 2.5% interest per annum on the issue price, paid semi-annually.
• SGBs have an 8-year maturity, with premature redemption allowed after the 5th year.
• Capital gains on SGBs are fully tax‑exempt when redeemed at maturity.
• SGBs can be bought in the primary market (new issues) or the secondary market (stock exchanges).

What is a Sovereign Gold Bond?

The Government of India introduced the Sovereign Gold Bond (SGB) in November 2015 under the Gold Monetisation Scheme to offer an alternative investment to physical gold. They are government securities whose value is denominated in grams of gold.

Investors can purchase SGBs by paying the issue price in cash and redeem them in cash upon their maturity. Sovereign Gold Bonds allow you to own gold in a digital form without its inherent risks or bearing making and wastage charges. They are low-risk investments that provide returns.  

Sovereign Gold Bond Status in 2024–25 & 2025

As of the latest RBI and PIB updates, no new Sovereign Gold Bond tranches have been announced for FY 2024–25 or 2025. The details of the last issue of Sovereign Gold Bonds are given below:

Sovereign Gold Bonds Scheme Details

• Maturity Period: The maturity period of SGBs is 8 years. However, premature redemption is allowed from the 5th year. 
• Interest Rate: The current interest rate for SGB is 2.50% p.a., paid twice a year (semi-annually) for 8 years.
• Minimum Investment: The minimum initial investment is 1 gram of gold per investor.
• Maximum Investment: The maximum limit of investment is 4 kg of gold per investor (individual and HUF). However, for entities such as trusts and universities, 20 kg of gold investment is permissible. 
• Tradability: Only RBI can issue Sovereign Gold Bonds on behalf of the Central Government, and they can be traded on the Stock Exchange. 
• Tax Benefits: There is no capital gains tax upon redemption of SGBs. 
• Collateral for Loans: Sovereign Gold Bonds can be used as collateral for loans.
• Redemption Price: The redemption price is in rupees, based on an average closing price of gold of 999 purity in the previous three working days.

Sovereign Gold Bond Benefits

• Sovereign Gold Bonds provide guaranteed returns since it is a government-backed scheme. 
• You can earn a guaranteed annual interest at the rate of 2.50% (on the issue price).
• SGBs have low-risk since they come with a sovereign guarantee on the principal and the interest earned.
• You can trade gold sovereign bonds on stock exchanges within a specific date (at the issuer's discretion). For instance, after completing five years of investment, you can trade them on the National Stock Exchange or Bombay Stock Exchange, among others.
• Some banks accept SGB as collateral/security against loans pledged in Demat form. Hence, they will treat it as a gold loan after setting the loan-to-value (LTV) ratio to the value of gold. The India Bullion and Jewellers Association Limited determines this.

Eligibility of a Sovereign Gold Bond

The following are eligible to subscribe for SGB:

• Indian resident individuals
• Individuals on behalf of a minor
• Trusts
• HUFs
• Universities, and
• Charitable institutions 

How do Sovereign Gold Bonds Work?

• Purchase Sovereign Gold Bond from a bank, SHCIL or designated post offices.
• If you have purchased an SGB online, it will reflect in the Demat account portfolio. In case of offline purchase, you can collect the SGB certificate from the holding of the issuing bank, post offices, SHCIL offices or designated agents.
• You will get a 2.5% interest per annum.
• You can redeem your SGB after 8 years or prematurely redeem it after 5 years.

How to Invest in New SGB Issues (Primary Market)? 

An investor can apply for a Sovereign Gold Bond through various authorised channels such as banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices, and recognised stock exchange, such as the Bombay Stock Exchange and National Stock Exchange of India Limited, either directly or via registered agents.

Follow these steps when a new tranche is announced:

• Visit your post office, SHCIL, or recognised stock exchange portal.
• Choose Sovereign Gold Bond under investment options.
• Enter subscription quantity + nominee details.
• Make payment via net banking/UPI/debit card.
• Receive SGB certificate or Demat credit.

SGBs can also be bought online through the commercial banks’ websites authorised to sell them. The process to purchase SGBs through a bank’s online website is as follows:

• Login to the bank’s internet banking account.
• Click on the ‘e-service’ option and choose the ‘Sovereign Gold Bond’ option.
• Read the terms and conditions and click the ‘Proceed’ option.
• Fill out the registration form and click the ‘Submit’ button.
• In the purchase form, enter the nominee details and subscription quantity.
• After verifying all the details, click the ‘Submit’ option and make the payment.
• You will receive a confirmation message along with the bond certificate in your email or Demat account.

How to Buy Existing SGBs on Exchanges (Secondary Market)?

Investors can purchase previously issued SGBs on NSE/BSE:

• Search for SGB + series name (e.g., SGBSEP28).
• Check liquidity and market premiums/discounts.
• Place buy order through your broker.
• Prices may trade below gold price (discount) or above it depending on demand.

Gold ETF vs SGB 

Given below is a comparison between Gold ETF and SGB:

How do SGB Returns Work?

SGB returns come from two components:

• Fixed 2.5% annual interest on issue price.
• Gold price appreciation.

Example:

Issue price = Rs. 6,263 per gram

Gold price after 8 years = Rs. 12,500 per gram

Interest earned = 2.5% × Rs. 6,263 × 8 years = Rs. 1,252

Capital gains = Rs. 12,500 – Rs. 6,263 = Rs. 6,237 (tax‑free)

Total return per gram ≈ Rs. 7,489

Sovereign Gold Bond Redemption

When the issued SGB completes 8 years, it comes up for final redemption. The price for final redemption is determined based on the simple average closing price of gold with 999 purity in the previous 3 working days, as reported by the India Bullion and Jewellers Association Ltd (IBJA).

The RBI has fixed the final redemption price of Rs. 12,567 per unit  of SGB for the SGB 2017-18 Series III, which is due for final redemption on October 16, 2025. This price fixed is based on the simple average of the closing gold price for the three business days, i.e., October 13, 2025, October 14, 2025, and October 15, 2025.

Sovereign Gold Bond Premature Redemption Price

The price for redemption is determined based on the simple average closing price of gold with 999 purity in the previous 3 working days, as reported by the India Bullion and Jewellers Association Ltd (IBJA). 

Investors can initiate early redemption of their SGBs after 5 years from the date of SGB issuance, coinciding with the interest payment date. SGB 2017-18 Series-IX is up for final redemption on 27 November 2025 at a price of Rs. 12,484 per unit per SGB.

Sovereign Gold Bond Price History

The price history of SGB for 2023-24 is as follows:

The price history of SGB for 2022-23 is as follows:

Premature/Final Redemption

Sovereign Gold Bonds redeemed either prematurely after the 5th year or at final maturity in the 8th year follow the RBI’s redemption formula. It is based on the simple average closing price of 999-purity gold over the previous three working days. 

Looking at the 2022–2024 issue prices (Rs. 5,091–Rs. 6,263 per gram), redemption levels recorded for earlier tranches demonstrate how gold’s steady multi‑year appreciation has translated into meaningful long‑term gains for investors.

Sovereign Gold Bond Tax Exemption

There are no tax deduction benefits for the lump sum deposit of SGBs under Section 80C of the Income Tax Act. The interest given on SGB deposits is also not tax-free. The interest amount must be declared under ‘Income from Other Sources’ during tax returns. The income tax will be as per the individual’s income tax slab. Tax Deducted at Source (TDS) is not applicable on SGBs. 

However, SGBs are exempt from capital gains tax when held till maturity. If SGBs are redeemed prematurely through RBI after the completion of five years, the proceeds are exempt from Long-Term Capital Gains (LTCG) tax. 

However, if the SGBs are sold on an exchange or transferred privately before their maturity period, the profits are treated as capital gains:

• Short-term capital gains (STCG): When they are held for up to two years, gains are taxed as per the individual's income tax slab.
• Long-term capital gains (LTCG): When they are held for more than two years, it is taxed at 12.5% without indexation.

Pros and Cons of Sovereign Gold Bonds

Before choosing SGBs as an investment, it is important to understand both their advantages and limitations to evaluate whether they align with your financial goals.

Pros

• Tax‑free capital gains at maturity.
• Guaranteed 2.5% annual interest.
• No storage or security concerns.
• Eligible as loan collateral.
• Higher long‑term returns vs physical gold.

Cons

• 8‑year lock‑in period.
• Liquidity depends on market demand.
• Interest is taxable.
• NRIs cannot invest (only hold if earlier purchased).

Gold Sovereign Bonds are new-age investment vehicles for those interested in diversifying their portfolio with gold holdings. They offer a blend of safety, assured interest, and tax‑free maturity returns. While new issuances are currently paused, existing SGBs remain attractive for long‑term wealth creation due to rising gold prices and favourable tax treatment.

Related Articles

How to Buy Sovereign Gold Bonds Online?
Gold Investment in India- How to Invest, Options, Benefits
Gold Monetisation Scheme (GMS)