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RBI announces premature redemption value for 2020-21 Series XII bonds due on September 9, 2026
Pooja Srivastava
Anytime News Network
Investors holding Sovereign Gold Bond (SGB) 2020-21 Series XII have been informed of the premature redemption price applicable on September 9, 2026. The Reserve Bank of India (RBI) has fixed the redemption value at ₹15,355 per unit.
According to the RBI press release, the tranche was issued on March 9, 2021. Under the applicable government notification, premature redemption of SGBs may be permitted after the fifth year from the date of issue, on the date on which interest is payable. The next due date for premature redemption of this tranche is therefore September 9, 2026.
The redemption price is linked to the market value of gold. RBI stated that the price is based on the simple average of the closing price of 999-purity gold for the previous three business days, as published by the India Bullion and Jewellers Association Ltd (IBJA).
For the September 9 redemption, the three business days considered were September 4, September 7 and September 8, 2026.
The announcement highlights the market-linked nature of SGB exits. While the redemption value has been declared, the actual profit or loss for an individual investor cannot be determined from this figure alone, as the original purchase price and other investment details vary from one bondholder to another.
SGB investors receive interest along with returns linked to the value of gold. However, when premature redemption is exercised, the amount payable is determined by the applicable market-based pricing formula. This means investors must compare the announced redemption value with their original investment cost to assess their own outcome.
The RBI release does not provide individual investor-level profit or loss figures. It only specifies the redemption price applicable to the identified tranche on the due date.
For bondholders of SGB 2020-21 Series XII, the premature redemption value has been fixed at ₹15,355 per unit for September 9, 2026, subject to the applicable scheme rules and redemption process.
