Gold Silver Reports — Investors Yet to Get Gold Bonds in Demat Accounts — Many investors in government’s sovereign gold bonds (SGBs) are a worried lot as the instruments are yet to be credited into their demat accounts. The government has so far managed to raise more than `2,200 crore through four tranches of gold bonds from 4.5 lakh investors .
Brokers whom ET spoke to said many investors were approaching them with just allotment letters but were unable to trade as they had not received the bonds in their demat accounts. These gold bonds can be traded on the stock exchanges .
Sovereign gold bonds are government securities denominated in multiples of gram of gold with a minimum unit of 1 gram and maximum of 500 grams. While investors can also hold them in physical form, most choose to hold it in demat form for ease of trading .
A portfolio manager at a Mumbaibased brokerage house said that a large number of investors, mainly from the fourth tranche of SGB issue, were yet to get the instruments in their demat accounts. “The delay in crediting the bond of demat accounts was causing anxiety as gold prices have been witnessing sharp fluctuations for the past few weeks and many would want to trade,“ the portfolio manager said.
“Delivery of the gold bonds for a few tranches are not yet credited and dispatched to investors,“ said Deepak Panjwani, head of debt markets at GEPL Capital. “Investors are inquiring this. Since the issuing body is the Reserve Bank of India (RBI), we are trying to convince investors of their safety . The central bank will deliver it at one point of time. Operational difficulties might have caused the delay ,“ he said.
“As of now, the notification which has been issued covers the first tranche for which demat is complete. Delays in demat occurred mainly due to errors in the data furnished by investors -such as incorrect DP id and the like which required interactions with the investors by the banks concerned, rectification of the errors, validation and reloading the data. With better customer awareness, errors in the subsequent tranches are showing a reducing trend which is a good sign,“ the RBI said.
An official from a large depository , which is maintaining most of the client demats for sovereign gold bonds, said investors’ accounts would be credited once they receive the certificates and instructions from the RBI. Investors, who have bid for the fourth tranche of SGBs have an allotment letter and are entitled for an interest rate of 4% annually as the period funds are transferred from clearing corporations and instruments credited to their demat accounts. The subscription for the fourth tranche of SGBs ended on July 22 and investors are likely to get interest on these bonds from the next day itself. — Neal Bhai Reports