The Sovereign Gold Bonds will offer an interest rate of 2.75 per cent and will remain open for public subscription between November 5-20, Finance Ministry said today.
Aimed at providing an alternative to buying physical gold, the gold bond scheme will offer investors a choice to buy bonds worth 2 grams of gold, up to a maximum of 500 grams.
"The bonds will be issued on November 26, 2015. Applications for the bond will be accepted from November 5, 2015 to November 20, 2015.
"The bonds will be sold through banks and designated post offices as may be notified," a Finance Ministry statement said.
This is the first tranche of the gold bond scheme and subsequent tranches would be notified later, it added.
The tenor of the bond will be for a period of eight years with exit option from 5th year to be exercised on the interest payment dates, the statement said.
"Price of bond will be fixed in Indian Rupees on the basis of the previous week's (Monday-Friday) simple average of closing price of gold of 999 purity published by the India Bullion and Jewellers Association Ltd," it added.
The same procedure would be followed for calculating the redemption price for the bonds.
