The RBI has confirmed that premature redemption of Sovereign Gold Bonds issued in 2020-21 is possible from September 09, 2026. The redemption price will be calculated based on the average of the gold price during the last three business days.
Premature Redemption under Sovereign Gold Bond Scheme
The Reserve Bank of India (RBI) has announced that premature redemption for the Sovereign Gold Bond (SGB) 2020-21 Series XII will be permissible beginning on September 09, 2026. This action is in accordance with the Government of India notification allowing redemption after the completion of five years from the issue date, which was on March 09, 2021.
The redemption price for these bonds will be determined based on the simple average of the gold price during the last three business days preceding the redemption date. This mechanism ensures that investors receive a market-reflective price for their gold holdings, adhering to prevailing market conditions.
This announcement has significant implications for investors seeking liquidity from gold holdings while also providing an opportunity to capitalize on any appreciation in gold prices. Legal practitioners and financial advisors should advise their clients accordingly, especially those considering early redemption.
Citations
- Sovereign Gold Bond Scheme (2026) RBI Notification