Investors holding Sovereign Gold Bonds issued between 2019 and 2021 can apply for premature redemption in June 2026, with the Reserve Bank of India opening redemption windows for five bond tranches during the month. According to reports from The Times of India, investors planning to exit before the eight-year maturity period must submit their requests within the specified timelines through banks, post offices, NSDL, CDSL or RBI Retail Direct. Missing the submission window may result in the redemption request being rejected. The latest schedule shows 2021-22 Series II with submission window from April 30, 2026 to May 22, 2026, 2021-22 Series III from May 8, 2026 to May 29, 2026, 2019-20 Series VII from May 8, 2026 to June 1, 2026, 2019-20 Series I from May 11, 2026 to June 1, 2026, and 2020-21 Series III from May 16, 2026 to June 6, 2026.
The SGB 2021-22 Series-II has delivered exceptional returns with the RBI announcing a premature redemption price of ₹15,672 per gram, representing a 227.05% return from the original issue price of ₹4,792 per gram. Based on the redemption price of ₹15,672, the absolute gain per gram stands at ₹10,880. An investment of ₹1,00,000 at the time of issuance would grow to approximately ₹3,27,000 based on the redemption price, excluding cumulative interest income earned over the years. The redemption price is calculated using the simple average of closing gold prices for the last 3 business days before redemption, based on 999 purity gold rates published by the India Bullion and Jewellers Association (IBJA).
A total of 33 Sovereign Gold Bond tranches issued between 2018-19 and 2021-22 will become eligible for premature redemption during FY2026-27, according to an ET report. This represents a significant portion of the SGB portfolio that will reach redemption eligibility during the upcoming fiscal year. Premature redemption of SGBs is permitted after 5 years from the issue date as per RBI guidelines. The SGB 2021-22 Series-II was issued on June 1, 2021, making June 1, 2026, the first eligible redemption date, though redemption can only be exercised on scheduled interest payment dates to ensure consistency with the bond's semi-annual interest payout cycle.
SGBs are government-backed securities denominated in grams of gold and offer investors exposure to gold prices along with a fixed annual interest payment of 2.5% per annum on the initial investment amount. As reported by The Times of India, investors pay the issue price in cash, while redemption is made in cash based on prevailing gold prices at the time of maturity or premature redemption. The redemption value is based on the simple average closing price of 999-purity gold published by the India Bullion and Jewellers Association (IBJA) for the preceding three working days. Interest is credited semi-annually to the investor's bank account, while the final interest payment is made along with the principal amount at maturity or redemption. From April 1, 2026, tax rules for SGBs have been revised, with capital gains tax now applying on premature redemption, while full tax exemption is limited to original subscribers holding until maturity.
