Investing in Gold Bond? Here all You Need to Know


The Indian government announced its decision to issue sovereign gold bonds six years ago. They wanted to provide their citizens with a substitute for physical gold. The worries of the rising current account deficit due to the increase in the import of yellow metal made the government introduce the scheme. They wanted to provide an alternative for physical gold. They decide to issue sovereign gold bonds that are denominated in grams of gold. The bondholder pays the market price of the gold bond in cash. On maturity of the bonds, the bondholder receives redemption proceeds in cash into their account.

The Reserve Bank of India issues the sovereign gold bond to all citizens who are residents of India. When you buy a sovereign gold bond from the government, you are lending them money. It is effectively a loan, which the government can raise funds to spend on new projects, infrastructure, or any other expenditure. In return, the government also promises to pay you a rate of money at a specified period. That is called the interest, and you will receive it until the maturity of the bond.

Steps to invest in Sovereign gold bonds:

How to subscribe to sovereign gold bonds:

If you want to buy a sovereign gold bond, you can do so through authorized brokers. You can also buy these bonds online:

You can now invest in a convenient and hassle-free manner in sovereign gold bonds. ICICI direct offers you gold-linked returns that the government guarantees.


As an investor, sovereign gold bonds can offer you the benefits of assured returns and liquidity. It can also be used as collateral for loans and you are exempted from paying capital gain tax on gains made on redemption. Sovereign gold bonds also take away the hassle of storage and safety that you will face when you buy physical gold.

Disclaimer – ICICI Securities Ltd. ( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. – ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400 025, India, Tel No : 022 – 6807 7100. I-Sec is acting as a distributor to solicit bond related products. All disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism. The contents herein above shall not be considered as an invitation or persuasion to trade or invest.  I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. Investments in securities market are subject to market risks, read all the related documents carefully before investing.

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