Government to withdraw 7.75% Savings (Taxable) Bonds scheme
- The government has decided to withdraw 7.75% Savings (Taxable) Bonds scheme from the close of banking business on Thursday due to declining interest rates.
- The scheme, commonly known as RBI Bonds or GOI bonds, is popular among retail investors who looking for safety of principal and a regular income. NRIs, however, are not eligible for making investments in these bonds.
- “The Government of India, hereby notifies that the 7.75% Savings (Taxable) Bonds, 2018…shall cease for subscription with effect from the close of banking business on Thursday, the 28th of May, 2020,”
- The Reserve Bank of India too has notified the Cessation of 7.75% Savings (Taxable) Bonds, 2018. Interest on the Bonds is taxable.
- The Bonds are issued at par at ₹100. The minimum subscription was fixed at ₹1,000.
- The Bonds are be repayable on the expiration of seven years from the date of issue.
- The interest rate on bank fixed deposits as well as lending rates are on decline with the Reserve Bank of India lowering the key short-term lending (repo) rate. The repo rate is currently at historic low of 4 per cent.
About Reserve Bank of India (RBI)-
- The Reserve Bank of India is India’s central bank, which controls the issue and supply of the Indian rupee.
- RBI is the regulator of the entire Banking in India.
- RBI plays an important part in the Development Strategy of the Government of India.
- RBI regulates commercial banks and non-banking finance companies working in India.
- It serves as the leader of the banking system and the money market.
- It regulates money supply and credit in the country.
- The RBI carries out India’s monetary policy and exercises supervision and control over banks and non-banking finance companies in India.
- RBI was set up in 1935 under the Reserve Bank of India Act,1934.
- Founded – 1st April 1935
- Headquarters– Mumbai
- Governor– Shaktikanta Das
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