The SGB interest rate has been set by the government at 2.5% per year on the nominal value of gold. Your account gets credited with interest twice a year. Aside from the interest rate, your gold investment will stay secure and will continue to generate financial gains if gold prices rise.

SGB investments have an 8-year lock-in term. You can, however, make an early exit after 5 years on the interest payout date.

The government has set the price of SGB per unit at Rs 5,091. There is an enticing reduction of Rs 50 per gramme for those who invest in SGB through online means, making the effective price for online investors Rs 5,041 per gramme.

Individuals, trusts, HUFs, charitable organizations, and institutions are all welcome to invest in SGB. It is also possible to invest on behalf of a minor or jointly.

The interest earned on SGB investments is taxed according to the rules of the Indian Tax Act. However, capital gains earned over time are tax-free and provide indexation benefits if held until maturity.