Mumbai | October 20,2025 | SKY LINK TIMES
The Reserve Bank of India (RBI) has declared the early redemption price for the Sovereign Gold Bond (SGB) 2020–21 Series-VII, offering investors a substantial 153% return over five years. The redemption will take place on October 20, 2025, exactly five years after the bond’s issuance.
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Reserve Bank of India Fixes Redemption Price at ₹12,792 per Gram
According to the RBI’s official notification, the redemption price has been set at ₹12,792 per gram, determined by the average closing price of gold (999 purity) published by the India Bullion and Jewellers Association (IBJA) between October 15 and 17, 2025.
Investors who subscribed to the Series-VII tranche in October 2020 at an issue price of ₹5,051 per gram have thus earned a remarkable gain of ₹7,741 per gram, excluding the annual 2.5% interest paid semi-annually during the holding period.
Sovereign Gold Bond Scheme: A Golden Alternative to Physical Gold
The Sovereign Gold Bond (SGB) Scheme, introduced by the Government of India, allows citizens to invest in gold digitally without holding it in physical form. Each bond carries a tenure of eight years, with an option for premature redemption after five years from the date of issue.
Apart from capital appreciation linked to gold prices, investors receive 2.5% annual interest, credited every six months. The capital gains tax is fully exempt on redemption at maturity, making it one of the most tax-efficient investment options in the market.
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How Investors Can Redeem Their SGB Holdings
Eligible investors who wish to opt for early redemption must verify their bond series and issue date before proceeding. Requests should be submitted through banks, designated post offices, or Stock Holding Corporation of India (SHCIL) within the RBI-specified timeline.
The redemption value is calculated transparently based on IBJA’s average gold prices for the three business days preceding the redemption date.
Gold Continues to Outperform
With the latest SGB redemption yielding 153% in just five years, gold continues to reaffirm its status as a safe-haven asset and a profitable long-term investment. Analysts believe this strong performance underscores the appeal of gold-linked securities amid inflationary pressures and global market volatility.
For investors seeking stability and assured returns, SGBs remain one of the most attractive government-backed instruments blending safety, liquidity, and capital growth.
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