Sovereign Gold Bond 2017-18 Series IX matures today:Investors set for over 300% returns; here’s how the RBI calculated the final redemption value

The Sovereign Gold Bond (SGB) 2017-18 Series IX reaches its maturity today, November 27, 2025, with investors poised to earn returns exceeding 300%. On Wednesday, the Reserve Bank of India announced the final redemption details for the tranche, which was originally issued on November 20, 2017. The bond now completes its eight-year tenure as outlined in the Government of India’s October 2017 notification. According to the RBI, the redemption price for this series has been set at ₹12,484 per unit, based on the simple average of closing prices of 999-purity gold recorded by the India Bullion and Jewellers Association (IBJA) over the three business days preceding maturity—November 24, 25 and 26. The bond was originally offered at ₹2,964 per gram, giving investors who held the bond till maturity a substantial windfall. The maturity amount will be credited directly to investors’ linked bank accounts. Investors Reap Windfall Gains Those who subscribed to this tranche in 2017 are earning a gain of roughly ₹9,520 per unit, translating to a return of over 320% across eight years. The scheme’s fixed annual interest further boosts the overall yield, making this maturity one of the strongest performers among past SGB issuances. About the Sovereign Gold Bond Scheme Launched as a government-backed alternative to purchasing physical gold, the SGB scheme offers investors the dual benefit of: · A 2.5% annual interest rate on the issue price · Capital appreciation linked directly to gold prices Issued by the RBI on behalf of the Centre, the scheme is designed to reduce dependence on imported gold and encourage households to shift from physical to financial gold. SGBs carry an eight-year maturity, with an option for early redemption after the fifth year on interest payment dates. The bonds can also be traded on stock exchanges, transferred, or pledged as collateral. Government Discontinues SGB Scheme The government discontinued the Sovereign Gold Bond (SGB) scheme in February 2024, ending all fresh issuances. The decision, reaffirmed during the post-Budget 2025 briefing, was attributed to the scheme becoming a “high-cost borrowing” option for the government. Although no new bonds will be released, all existing SGBs remain fully valid. Investors will continue to receive interest and can redeem their holdings as per the original maturity schedule or opt for early exit where permitted. How SGBs Were Purchased Investors could buy SGBs through banks, Stock Holding Corporation of India Limited (SHCIL), and designated post offices. Offline buyers receive a physical certificate, while online purchases reflect directly in demat accounts. All SGBs earn the standard 2.5% per annum interest. Tax Rules for SGB Holders Under the Income-tax Act, interest earned on SGBs is taxable. However, capital gains arising on redemption at maturity are fully exempt. If sold on the exchange before maturity, investors are eligible for indexation benefits on their gains.