The Reserve Bank of India set the gold bond redemption price for Sovereign Gold Bond 2020-21 Series I at ₹14,159 per unit for investors choosing early redemption on October 28, 2026.

Key Takeaways

  • The series was issued on April 28, 2020, at ₹4,589 per gram for online purchases.
  • The redemption price represents a gain of about 208.54% over that online issue price, excluding interest.

How the gold bond redemption price was set

The redemption price is based on the simple average closing price of 999-purity gold published by the India Bullion and Jewellers Association for the preceding three working days: October 23, 26 and 27, 2026.

Early redemption is permitted after the fifth year from issue, on a date when interest is payable. The October 28 redemption is an option for investors, not confirmation that every holder has redeemed.

What the price means for an online investor

Compared with the ₹4,589-per-gram online issue price, the ₹14,159 redemption price represents a gain of ₹9,570 per unit, or approximately 208.54%. That calculation excludes interest earned during the holding period.

On the same proportional basis, an initial ₹1 lakh investment would be worth approximately ₹3,08,540 at the redemption price, excluding interest. Sovereign gold bonds generally pay fixed annual interest of 2.50% on the initial investment.

The RBI’s government securities primer also describes put options on other bonds that can allow investors to sell them back to the issuer before maturity. The gold bond series has its own early-redemption terms.

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