Cash collateral not required while placing bids for SGB: BSE

NEW DELHI: Leading stock exchange BSE today said upfront deposit of cash collateral will not be required while placing bids for Sovereign Gold Bond ( SGB) from tomorrow.

"Members are hereby informed that, with effect from Wednesday, July 20, 2016, while placing bids for Sovereign Gold Bond (SGB) Scheme 2016-17 - Series 1 upfront deposit of cash collateral will not be required," BSE said in a circular.

Instead of the cash collateral, members will have the facility to effect funds pay-in for the SGB bids placed on BSE SGB platform, the exchange added.

The SGB issue price has been fixed at Rs 3,119 per gram. An investor can invest for a minimum unit of one gram and a maximum of 500 grams. The subscription is open till July 22.

The 4th tranche of Sovereign Gold Bond (SBG) scheme opened for subscription yesterday, through which government aims to attract a large number of investors so as to curb demand for physical gold. Gold imports have been draining the country's foreign exchange.