- SOVEREIGN GOLD BOND SCHEME
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))
- 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.
- Timely and correct payment to the pensioners.
- Accurate and real time status of pension budget.
- Multiple channels for pensioners to avail different departmental services.
- 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.