What are RBI Bonds?

Government of India Savings (Taxable) Bonds also called RBI bonds which come with sovereign guarantee with no risk to your principal amount. The rate of interest on  Bonds is 7.75 per cent with two payout options -- non-cumulative option offers interest on half yearly basis, while cumulative option pays interest on maturity.

Any individual could invest in these RBI taxable bonds, without any maximum investment limit. The minimum investment in the bonds starts at Rs 1,000.

RBI bonds have a tenure of seven years and offer 7.75 per cent rate of interest per year, payable half-yearly. The investor also has the option of taking the cumulative option. Since these bonds are issued by the Government of India, there are no credit risks.