SGB 2020-21 Series II premature redemption due today. Investors can get up to 250% returns

The Reserve Bank of India via its press release dated May 18, 2026 announced the premature redemption date for SGB 2020-21 Series II as May 19, 2026. Premature exit from SGB is allowed post the completion of five years in the scheme from the bond issuance date on the interest/ coupon payment date.

The redemption price for SGBs is decided based on the simple average of the closing price of gold of 999 purity of previous three business days from the date of redemption, as published by the India Bullion and Jewellers Association Ltd (IBJA). So, for this series of SGB, the redemption price is set at ₹15,904 per unit of SGB.

Mirroring trends in the overseas bullion market, gold price in India has been highly volatile of late. Also, adding to the volatility, the government last week increased the import duty on gold and silver to 15%.

Investors in the scheme will be able to rake in a return of up to 250% as the issuance price for those investing via the online route was at ₹4,540 per gram (including a ₹50 per unit discount).

Another SGB issue- SGB 2021-22 Series I will become eligible for early redemption next week on May 25.

How to apply for premature redemption of SGBs?

As per the FAQs on RBI website, in case of premature redemption, investors can approach the concerned bank/SHCIL offices/Post Office/agent thirty days before the coupon payment date. Note the request for premature redemption can be only entertained if the investor approaches the concerned bank/post office at least one day before the coupon/ interest payment date.

The proceeds of the investment will then be credited to the bank account initially provided at the time of investment in the scheme.