RBI sets Rs 14,213 redemption price for 2019-20 gold bonds
RBI fixed the early redemption price of Sovereign Gold Bond 2019-20 Series VI at Rs 14,213 a unit for 30 October 2026, based on three days of gold prices.
The Reserve Bank of India said on 29 October 2026 that holders of Sovereign Gold Bond (SGB) 2019-20 Series VI who redeem early on 30 October will receive Rs 14,213 per unit. On the same day it set the interest rate on the Government of India Floating Rate Bond 2034 at 7.26% a year for the next six months. Both releases are routine, but they show how two government-backed products are priced: one follows gold, the other follows short-term borrowing rates.
How the redemption price was set
An SGB is a government bond whose value tracks gold. Each unit stands for one gram of gold, and the investor gets a fixed 2.5% a year in interest on the original amount, usually paid every six months, on top of the gold-linked value at exit, per the Outlook Business explainer. The RBI's release says the price is the simple average of the closing price of 999-purity gold, as published by the India Bullion and Jewellers Association (IBJA), over the three business days before redemption: 27, 28 and 29 October 2026.
The bond's rules, set in a government notification dated 30 September 2019, allow early exit after the fifth year, on an interest payment date. The bonds run for eight years, so Series VI matures in 2027.
What the gain looks like
The RBI release does not state a return, but the issue price is public. RBI's 2019 notice gave Rs 3,835 per gram, or Rs 3,785 for people who applied and paid online. Our arithmetic from those two numbers: Rs 14,213 is about 2.7 times the nominal issue price, a gain of roughly 271% (about 276% against the online price), before the 2.5% interest.
A year earlier the same series paid Rs 11,992 on 30 October 2025, based on prices from 22 to 24 October of that year, according to Outlook Money. That makes this year's price about 18% higher. Outlook Money reported that 30 October 2025 was the first early-redemption date after the fifth year, so this is a later window, not the first, and holders who stayed in have now seen two such dates.
Why this window matters
The government stopped issuing new SGBs. Outlook Business reported in February 2025 that the last tranche came on 21 February 2024 and that a finance ministry official called the bonds a very costly way to borrow, because the government owes the gold-linked value at exit plus interest. When gold rises, that cost rises with it. The sources we opened do not say how much SGB debt is outstanding now.
The floating rate bond coupon
A floating rate bond resets its interest at set intervals instead of paying a fixed rate. The 2034 bond's coupon for 30 October 2026 to 29 April 2027 is the average of the last three auction yields on 182-day Treasury Bills plus a fixed spread of 0.98%, the RBI says. A Treasury Bill is a short-term government IOU. The 7.26% result implies those three auctions averaged about 6.28%, our arithmetic from the figures.
What it means for holders
Holders of Series VI who want early exit can use the 30 October window at Rs 14,213 per unit, while the rest can wait for later interest dates or the 2027 maturity. Tax treatment depends on how and when a holder exits and has changed over time. Holders should check the current tax rules.
Investors in the floating rate bond see the coupon move with short-term government borrowing, so the income rises when Treasury Bill yields rise and falls when they ease.
What to watch next
- The RBI's next SGB redemption notices, which come out a few days before each interest payment date.
- The next coupon reset for the 2034 floating rate bond, due for the half-year from 30 April 2027.
- Gold prices, which drive both the payout and the government's cost.
Key takeaways
- The RBI fixed the early redemption price of SGB 2019-20 Series VI at Rs 14,213 per unit for 30 October 2026.
- The price is the average of IBJA gold closing prices on 27, 28 and 29 October 2026.
- The Floating Rate Bond 2034 coupon is 7.26% a year for 30 October 2026 to 29 April 2027.
- Both announcements are scheduled releases, not policy changes.
Sources
- [RBI: Premature redemption of Sovereign Gold Bonds 2019-20 Series VI](https://rbi.org.in/Scripts/BSPressReleaseDisplay.aspx?prid=63884)
- [RBI: Interest rate on Floating Rate Bond 2034](https://rbi.org.in/Scripts/BSPressReleaseDisplay.aspx?prid=63883)
- [RBI: Sovereign Gold Bond Scheme 2019-20 Series VI issue price](https://rbi.org.in/Scripts/BSPressReleaseDisplay.aspx?prid=48444)
- [Outlook Money: SGB 2019-20 Series VI to deliver 217% return](https://www.outlookmoney.com/invest/sovereign-gold-bonds-sgb-2019-20-series-vi-to-deliver-217-return-to-its-investors)
- [Outlook Business: Govt likely to discontinue sovereign gold bond schemes](https://www.outlookbusiness.com/economy-and-policy/govt-likely-to-discontinue-sovereign-gold-bond-schemes-confirms-finance-ministry)
Tags: RBI Sovereign Gold Bond Gold Government securities Investors