Government stops subscription for 8% GoI savings bonds
New Delhi, The government on Monday announced that its GOI Savings Bonds, 2003, earning 8 per cent interest per annum, will cease subscription from January 2.
 
The bonds have been popular on account of offering a higher rate of interest than small savings and fixed deposit rates.
 
"The Government of India announced here today that 8 per cent GOI Savings (Taxable) Bonds, 2003, shall cease for subscription with effect from the close of banking business on Tuesday, January 2, 2018," a Finance Ministry release said. 
 
The bonds, with a tenure of 6 years, minimum investment of Rs 1,000, no limits on maximum investment and the option to receive interest on a half-yearly basis, are available in physical form only and are not listed or tradable on stock exchanges. 
 
The interest received from these bonds is taxable at the marginal rate of income tax the investor is liable for. 
 
These became a preferred choice for investors seeking fixed income like senior citizens and pensioners after the government cut interest rates on fixed deposits and small savings schemes like the post office monthly income scheme and public provident fund (PPF) to below 8 per cent in April 2016.
 
Last week, the government cut the interest rates on small saving schemes, including National Savings Certificates (NSCs), Public Provident Fund (PPF) and Kisan Vikas Patra (KVP), by 0.2 percentage point for the fourth quarter of the fiscal (January-March).
 
The PPF and NSCs earn 7.6 per cent interest from January 1, while KVPs earn even less (7.3 per cent).
 
Earlier, PPF, NSC and KVP were offering 7.8, 7.8 and 7.5 per cent interest, respectively.
 
Besides, while the interest on the Senior Citizen's Savings Scheme of five-year period was retained at 8.3 per cent, the Sukanya Samriddhi Yojana for the girl child now offers 8.1 per cent.
 
The government also retained the interest on savings deposits at 4 per cent, compounded annually.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
  • User

    Bond-holders Can Still Make Capital Gains
    It has been three good years for long-term bond-holders. They could make capital gains, with bond prices rising due to falling bond yields. Capital gains are taxable irrespective of whether you sell taxable or tax-free bonds. Short-term capital gains apply to sale of bonds within one year of purchase and the tax applicable is as per your tax slab. Long-term capital gains apply to sale after...
    Premium Content
    Monthly Digital Access

    Subscribe

    Already A Subscriber?
    Login
    Yearly Digital Access

    Subscribe

    Moneylife Magazine Subscriber or MAS member?
    Login

    Yearly Subscriber Login

    Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation
  • Will NRIs Dump Their PPF and NSC?
    A game-changing rule from the government has debarred non-resident Indians (NRIs) from investing in Public Provident Fund (PPF) and National Savings Certificate (NSC) with effect from 3 October 2017. Under the rule, PPF and NSC will yield only savings account interest from the day the person becomes an NRI. NSC investment by NRIs will have to be encashed, or deemed to be encashed on the day...
    Premium Content
    Monthly Digital Access

    Subscribe

    Already A Subscriber?
    Login
    Yearly Digital Access

    Subscribe

    Moneylife Magazine Subscriber or MAS member?
    Login

    Yearly Subscriber Login

    Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation
  • We are listening!

    Solve the equation and enter in the Captcha field.
      Loading...
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email

    BUY NOW

    online financial advisory
    Pathbreakers
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 3 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)