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PNB Gold Schemes

Punjab National Bank’s gold schemes serve as a convenient and reliable investment in gold. The bank offers special gold schemes that are designed to generate healthy returns on gold. Investors can buy the yellow metal from the bank directly. PNB is one of the banks that have been authorized to issue Sovereign Gold Bond scheme. The gold scheme bonds are issued by the Reserve Bank of India (RBI) on behalf of the Government of India. PNB gold scheme bonds are issued at specific branches of the bank, post offices and through agents. PNB also specializes in offering loan against gold schemes that customized to enable investors to opt for a loan to meet their unique financial objectives.

Let’s have a look at the PNB gold schemes:

Sovereign Gold Bond 2015 & 2016

Sovereign Gold Bonds (SGBs) introduced by Punjab National Bank in the year 2015 enables investors to invest in the yellow metal without holding physical gold. These bonds can be bought in the denominations of grams of gold on cash payment. The returns, that is, the accumulated amount and the interest accrued can be redeemed in the form of cash after the completion of the maturity tenure.

Features of Sovereign Gold Bond 2015 & 2016

  • Sovereign Gold Bond 2015 is available in denominations of 1 gram of gold and in multiples of 1 gram on further investments.
  • For an individual, the minimum limit for purchase for these bonds is 2 grams and the maximum cap is 500 grams in an annual year. For joint holders of this PNB gold scheme, these limits will be applicable to the first applicant.
  • Only the first holder of the bond can be chosen as the nominee for this gold scheme.
  • The cost of this PNB gold scheme is decided on the basis of the simple average closing price of gold of 999 purity of the last week, as published by the Jewellers Association Ltd. (IBJA) and the India Bullion. The bonds are evaluated in Indian Rupees.
  • An issue price of Rs.2,684 per gram has been fixed for this tranche of Sovereign Gold Bonds 2015 and Rs.2,916 per gram for Sovereign Gold Bond 2016.
  • On the initial investment, the rate of interest is fixed at 2.75% p.a.
  • The last instalment has to be paid on the completion of the pre-decided term along with the principal amount. Interest is paid in half yearly instalments.
  • The expiration of this PNB gold scheme is 8 years.
  • This PNB gold scheme offers investors the flexibility to redeem the returns prematurely on the day of interest payment after the completion of 5 years from the date of issuance of the bond.
  • Interest accumulated on the PNB gold scheme is taxable under the Income Tax Act 1961 and provisions laid down for capital gains.
  • A holding certificate will be issued to investors by the bank after the maturation of the PNB gold scheme. This certificate can be converted into a demat form.

Benefits of Sovereign Gold Bond 2015 & 2016

  • The bonds can be transferred or gifted to any individual who meets the eligibility criteria.
  • This PNB gold scheme is not tax deductible at source.
  • The bonds serve as collateral for loan applications and are widely acceptable by banks, other financial institutions and Non-Banking Financial Companies (NBFC).
  • Sovereign Gold Bond 2016 is eligible for Statutory Liquidity Ratio.
  • Commission for the distribution of Sovereign Gold Bonds 2016 is charged at the rate of 1% of the subscription amount.

Eligibility for Investing in Sovereign Gold Bond 2015 & 2016

  • Individuals, Indian residents, charitable institutions, trusts, universities and HUFs are eligible to apply.
  • Parents and legal guardians can apply for this PNB gold scheme on behalf of minors.
  • The bond can have joint holders.
  • The original and photocopies of Aadhaar card or PAN or Passport or Voter ID or TAN has to be shown as proof of identity at the time of purchase of the PNB gold scheme.
  • It is compulsory to submit the bank account details, so that the principal and the accrued interest can be paid to the investor after the completion of the maturity term.

PNB Gold Scheme: Gold Coins

Gold coins and ingots available at selective branches of Punjab National Bank acts as an effective gold investment.

Features of PNB Gold Scheme: Gold Coins

  • The gold coins offered by PNB are manufactured by PAMP Refinery in Switzerland.
  • Gold coins offer the purity of 24 karat that is 999.9% fine and accredited with an Assay certification.
  • The gold coins are available in the denominations of 5 grams, 8 grams, 10 grams and 20 grams.
  • The authenticity of the gold coins is guaranteed with the PNB logo that is hallmarked on it.
  • The gold coins are made available in a tamper-proof packaging, further assuring investors of its high quality and purity.

Benefits of PNB Gold Scheme: Gold Coins

  • Gold coins from PNB prove to be an effective investment instrument as gold prices seldom decline.
  • They are a convenient corporate or personal gifting option.
  • High quality and purity make PNB gold scheme a worthwhile investment.

PNB Gold Loan

Advance against Gold Jewellery, Ornaments and Gold Coins

Punjab National Bank offers tailor-made loan schemes against gold for productive purposes like agricultural activities. There are also loans customized for non-productive purposes like expenditures required for education, marriage, health and medical needs and other unforeseen expenses.

Features of PNB Gold Loan

  • The purpose behind loan applications decides the loan amount that will be offered. In case of productive purposes, the quantum of finance that will be approved is determined by the need for it. For loans sanctioned for non-productive purposes, the maximum limit offered as loan is Rs.10 lakh.
  • Interest rate on the loan is also decided on the basis of the purpose of the loan. It varies between 10.05% and 11.05%, as per 2018. Overhead charges like documentation fee and processing fee are also applicable.
  • The maximum maturity tenure applicable for loans against PNB gold coin is 12 months.
  • A margin of 25% is required.
  • The acceptable options for security are gold jewellery and gold coins (not weighing more than 50 grams for an individual) bought from an authorized branch of Punjab National Bank, as per the discretion of the bank.
  • The loan can be repaid through 12 monthly installments in a fiscal year or 4 quarterly instalments in a fiscal year. Alternatively, the loan can be prepaid without any additional charges being applicable on it. However, for loans offered on agricultural purposes, the interest is recovered through installments payable half-yearly or yearly, as per the quality of harvest recorded in that year. ###Documents required for being eligible for PNB gold loan

The following documents are accepted as proofs of identity while applying for a PNB loan. The original as well as the photocopy has to be presented at the time of loan application.

  • Aadhaar
  • PAN
  • Passport
  • Voter ID, and
  • TAN

Any one of the above, original and its photocopy, can be presented at the time of applying for a PNB gold scheme.

FAQs On PNB Gold Schemes

Can I apply for a gold loan from Punjab National Bank online?

No, Punjab National Bank does not enable online applications for gold loan. However, installment payments can be done through the online medium.

What are the documents required for being eligible for purchasing PNB gold schemes?

The necessary KYC or Know Your Customer documents that are accepted as proofs of identity are:

  • Aadhaar
  • PAN
  • Passport
  • TAN, and
  • Voter ID Any one of the above, original and its photocopy, can be presented at the time of applying for a PNB gold scheme.

What are the payment options for PNB gold schemes?

Punjab National Bank offers online as well as offline options for payment of installments. The offline options are cash, cheque and demand draft, while online payment option is by ECS.

What are the purposes of the various forms available for PNB Sovereign Gold Bond 2015?

Here’s the list for the different types of forms for PNB Sovereign Gold Bond along with their purposes:

Form A - Application

Form B – Receipt of acknowledgement

Form C - Holding certificate

Form D - Nomination

Form E - Cancellation of Nomination

Form F - Transfer