Government of India announced the scheme of Floating Rate Saving Bonds for Individuals and HUFs. NRIs are not allowed
Highlights of the Issue :
*Open for Subscription from July 1, 2020
* Minimum Investment amount - 1,000 and in multiples of 1,000 thereafter, Maximum - No limit.
* Interest to be paid Half yearly on every January 1 & July 1
* Maturity of the Bond is 7 Years.
* Coupon/Interest Rate is reset on every half yearly basis. (Cumulative option is not available)
* Initially the Bonds will be issued at a rate of 7.15% and on January 1, the rate of interest will be reset.
( The rate will be NSC rate + 0.35%. )
* Special Maturity Profile for Senior Citizens:
For Age 60-70 Years is 6 Years
For Age 70-80 Years is 5 Years
For Age 80 Years and above the maturity is 4 Years
(Premature encashment will Attract penalty- Penalty charges @ 50% of last coupon payment)
* Bonds will be held in the electronic form (Bond Ledger Account)
* Interest Amount is Taxable under income tax Act 1961
* Bonds are non transferable and cannot be kept as collateral.