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Floating rate bonds

RBI Bonds

Get the best of both worlds. Returns and safety.

What are the key things we check in an investment product while investing? Safety and returns. While some products are absolutely safe, they may not offer a reasonable rate of returns, and those who have the potential to generate higher returns carry higher risk.

RBI Savings Bond is one such investment product where you can get the right balance of both these factors

Safety

Since these bonds are issued by the Government of India and monitored by RBI itself they are considered one of the safest investment avenues.

Returns

Floating Rate Savings Bonds, 2020 (Taxable) offer an interest rate of 7.15 percent, higher than most bank FD rates

The RBI savings bonds are not tradable in the Secondary market and are not eligible as collateral for taking loans from banking institutions, non-banking financial companies or financial institutions.

Features of RBI Savings Bonds

Ensure 100% safety of capital
Start investment with as low as Rs.1,000
7.15% p.a. for the tenure of 7 years (from the date of issue)
Choose from Half Yearly Payable interest and Cumulative interest

Minimum lock-in period for Senior citizens for premature withdrawals

6 years for 60-70 year old investors
5 years for 70-80 year old investors
4 years for over 80-year-old investor

Limitations: These RBI Savings Bonds cannot be traded in the secondary market and are not eligible to be used as collateral for loans. These are also not transferable. No income tax exemption available, however, the bonds will be exempt from Wealth-Tax under the Wealth-Tax Act, 1957

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