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PIB – 10 July 2021

CONTENT

  1. SPARSH
  2. SOVEREIGN GOLD BOND SCHEME

SPARSH

Focus: Facts for prelims

Why in News ?

Ministry of Defence implements web-based integrated system for sanction & disbursement of defence pension SPARSH (System for Pension Administration (Raksha))

About SPARSH

  • SPARSH is an integrated system for automation of sanction and disbursement of defence pension.
  • This web-based system processes pension claims and credits pension directly into the bank accounts of defence pensioners without relying on any external intermediary.
  • A Pensioner Portal is available for pensioners to view their pension related information, access services and register complaints for redressal of grievances, if any, relating to their pension matters.
  • It is a Comprehensive Pension Package (CPP), an end to end Online System facilitating and easing every aspect of Defence Pensions from Initiation to Disbursement
  • An establishment of Service Centres aims at providing last mile connectivity to pensioners who may not be able to directly access the SPARSH portal for any reason.
  • In addition to several offices of the Defence Accounts Department which are already functioning as Service Centres for pensioners the two largest banks dealing with defence pensioners have been co-opted as Service Centres.
    • State Bank of India (SBI)
    • Punjab National Bank (PNB)
  • The pensioners can approach various branches of these two banks for obtaining any service relating to their pension issues.
Benefits
  • Timely and correct payment to the pensioners.
  • Accurate and real time status of pension budget.
  • Multiple channels for pensioners to avail different departmental services.
    • Portal
    • Mobile App
    • Service Centres
  • Call Centre availability. 
  • Structured grievance redressal mechanism.

SOVEREIGN GOLD BOND SCHEME

Focus: GS III- Indian Economy

Why in News?

Sovereign Gold Bond Scheme 2021-22–Series-IV- Issue price-published by RBI.

About Sovereign Gold Bond Scheme (SGB)

  • The Sovereign Gold Bond Scheme was introduced in the Union Budget 2015-16 by the Union Cabinet which was chaired by PM Narendra Modi.
  • It was launched to reduce the demand for physical gold and with an aim to invest a part of these physicals gold bars and coins that are purchased every year into financial savings in the form of gold bonds.
  • Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity.
  • The Bond is issued by Reserve Bank on behalf of Government of India.
  • Government introduced these bonds to help reduce India’s over dependence on gold imports.
  • The move was also aimed at changing the habits of Indians from saving in physical form of gold to a paper form with Sovereign backing.
  • The bonds will be restricted for sale to resident Indian entities, including individuals, Hindu Undivided Family (HUFs), trusts, universities and charitable institutions.
  • The bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram.
  • The tenor will be for a period of 8 years with exit option from the 5th year to be exercised on the interest payment dates.
  • The minimum permissible investment limit will be 1 gram of gold, while the maximum limit will be 4 kg for individual, 4 kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March) notified by the government from time to time.
  • In case of joint holding, the investment limit of 4 kg will be applied to the first applicant only.
  • Bonds can be used as collateral for loans.
  • The loan-to-value (LTV) ratio is to be set equal to ordinary gold loan mandated by the Reserve Bank from time to time.
Benefits of Sovereign Gold Bond
  • As a low-risk investment, it is perfect for investors with low-risk appetite.
  • Compared to physical gold, the cost to purchase or sell SGBs is quite low.
  • The expense of buying or selling the SGB is also nominal in comparison to the physical gold.
  • The gold bonds can be availed either in paper or in demat form as per the convenience of an individual.
  • The gold bonds invested by the Investors can be gifted or transferred to others who are eligible under the scheme.
  • They can also trade these bonds on stock exchanges subject to notifications of the Reserve Bank of India.
  • These Gold bonds can be purchased through multiple payment modes such as cheques, cash, DDs or electronic transfer.

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October 2022
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