The Reserve Bank of India (RBI) has announced the premature redemption of Sovereign Gold Bond (SGB) 2019-20 Series VII on December 10, 2025. Issued originally on December 10, 2019, the bond is now eligible for early exit after completion of the 5-year lock-in period.
According to RBI, the redemption price is set at ₹12,827 per unit for December 10, 2025. The price is based on the simple average closing gold price of 999 purity as published by the India Bullion and Jewellers Association (IBJA) for December 5, 8, and 9, 2025.
The entry price in 2019 was ₹3,795 per gram, translating into a capital gain of ₹9,032 per unit or around 238% over 6 years. Investors who subscribed digitally at ₹3,745 will see gains of ₹9,082 per unit, approximately 242%. These returns exclude the semi-annual 2.5% interest received over the holding period.
SGBs have a tenure of 8 years with an option for premature redemption after 5 years only on interest payout dates. To proceed with redemption, investors must submit a request in advance through the bank, post office, or agent from where the bond was purchased. The redemption process concludes with the amount being directly transferred to the investor’s bank account.
Launched by the Government of India and issued by RBI, Sovereign Gold Bonds provide a way to invest in gold without physical purchase. Bonds are issued in grams, offering a 2.5% annual interest on the initial investment alongside returns linked to gold prices.
These are tradable on stock exchanges, can be transferred, used as loan collateral, and redeemed tax-free upon maturity.
Read More: RBI Announces 6.52% Interest on FRB 2031 for December 2025–June 2026!
Interest income from SGBs is taxable under the Income-tax Act, 1961. However, capital gains at redemption are exempt from tax. Transfers made through exchanges will qualify for indexation benefits on long-term capital gains.
The RBI’s announcement for premature redemption of the Sovereign Gold Bond 2019-20 Series VII enables investors to realise substantial gains, with the redemption set at ₹12,827 on December 10, 2025. This redemption marks the completion of the mandatory lock-in period, giving investors an option to exit with significant returns earned over the last 6 years.
Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: Dec 10, 2025, 11:22 AM IST
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