BSE secures RBI clearance on SGB

Finally, the plan of RBI to make sovereign bonds attractive seems to be complete. The SGB scheme was launched on November, 2015 with an objective to reduce the demand for physical gold and shift a part of the domestic savings used for purchase of gold into financial savings.

The first tranche was issued in November 2015. More than 62,169 applications were accepted for a total subscription of 915.95 kgs amounting to Rs 246.20 crores by banks and post offices. The government had so far received subscription for Rs 4,916.253 kg of gold amounting to about Rs 1,322 crore.

In the second tranche (January 18 to 22), about 3.16 lakh applications were accepted for a total subscription of 2,872.3 kg of gold amounting to Rs 746.80 crore.

The third tranche of bonds, which was launched on March 8 2016, received a lukewarm response with the government getting a subscription for 1,128 kg’s of gold, amounting to Rs 329 crore which was less than the half it got in the previous round. There were around 64,000 applicants.

The whole idea to launch Sovereign Gold Bond, was to reduce the demand for physical gold. Therefore, RBI was trying to improve the scheme to make it more attractive and finally it was made attractive when it gave a green signal to BSE to start a trading platform on June 3.

The Exchange plans to offer an online bidding platform for collecting bids from members and their clients for the SGB issue.