RBI Investment Options for Resident and Non-Resident Indians

Investors often look for diverse options to grow their corpus and multiply their wealth. Among the popular choices for Indians is investing in RBI investment options, known for their security and steady returns. These investors can choose between the RBI Retail Direct Scheme or RBI Direct Gilt account and RBI floating rate savings bond to start their direct investment with RBI. Learn about the eligibility criteria and process to invest in these two RBI plans for a seamless experience. 

RBI Investment Options Available in India 

Two prominent RBI investment options in India are the RBI Retail Direct Scheme and the RBI Floating Rate Savings Bond. Individual investors can invest in government securities by choosing the RBI Retail Direct Scheme. In other words, retail investors, under this scheme, can open a Gilt Securities Account with RBI known as a Retail Direct Gilt Account (RDG and start their investment journey. 

RBI floating rate savings bonds are taxable bonds issued by the RBI on behalf of the Government of India. These bonds for 2024 offer an annual interest rate of 8.05%, which is 0.35% higher than the NSC (National Savings Certificate) rate. This interest is revised biannually, in January and July.

Features and Benefits of RBI Investment Options

Here are the features and benefits of investing in RBI investment plans:

RBI Retail Direct Scheme

The features and benefits of the RBI Retail Direct Scheme are as follows:

• A retail investor can place non-competitive bids for Central Government Securities in primary issuance. This includes Treasury Bills, Sovereign Gold Bonds and State Government-issued securities.
• Investors can use RBI’s trading system to access the secondary market.
• An investor receives the interest payouts and maturity proceeds in the linked savings bank account automatically.
• Nomination facilities with up to two nominee additions are allowed under the scheme.

RBI Floating Rate Savings Bonds

Here are the features and benefits of RBI floating rate savings bond:

• The maturity tenure of the bond is 7 years.
• Senior citizens can opt for premature withdrawal after a lock-in period of certain years, unlike regular citizens.
• The interest is payable semi-annually.
• Investors have to pay applicable taxes on the interest income.
• The interest rate is adjusted bi-annually to offer competitive rates aligned with the market conditions.

Eligibility Criteria to Invest in RBI Plans

Here are the eligibility criteria to invest in the following RBI plans:

RBI Retail Direct Scheme

The eligibility criteria for retail investors under the Retail Direct Scheme are as follows:

• The investor should have a savings account maintained in India in the Indian currency (rupee savings account).
• Investors should have a PAN (Permanent Account Number) that the Income Tax Department Issues.
• The investor should possess original KYC documents such as identity and address proof (Aadhaar card, Voter card, passport, driving license).
• Individual investors should have a valid email address and a registered mobile number.
• Non-resident Indians under the Foreign Exchange Management Act, 1999 can invest in this scheme.

RBI Floating Rate Savings Bonds

Here are the entities that are eligible to invest in RBI Floating Rate Savings Bonds: 

• Resident Indians  
• Hindu Undivided Families in India 
• Non-resident Indians 

How Can I Invest Directly in RBI?

Here is how you can invest in RBI investment options directly:

RBI Retail Direct Scheme

You can follow the process below to open RBI Retail Direct Gilt Account:

Step 1: Visit the RBI retail direct portal and register online.

Step 2: To open the account, provide your name, mobile number, PAN, email ID, residential address, bank account details and other necessary information. 

Step 3: Ensure you provide the correct mobile number and email address for OTP authentication.

Step 4: As an investor, you will receive a tracking number to track the status of your application.

Step 5: Based on the RBI KYC Direction 2018, the CCIL (Clearing Corporation of India Limited) will validate KYC details before onboarding the investor. For a joint account, KYC for both holders will be validated.

Step 6: The bank account will be validated.

Step 7: You need to fill in the nominee details while opening the account mandatorily. The screen will display the nominee details and you need to upload a scanned image of your signature to confirm. 

Step 8: On successful KYC verification, you will receive your account number and login credentials for the online portal to participate in primary auctions.

Step 9: Use the RDG account for secondary market transactions via RBI’s trading system. 

RBI Floating Rate Savings Bond

To invest in these bonds, all you need to do is visit the official RBI Retail Direct website and click on the ‘Floating Rate Savings Bond’ tab. The dashboard will reflect an ongoing auction. Fill in the ‘Bid Amount’ and ‘Bid Entry’ box, following which you need to initiate the payment. Upon successful payment, you will receive confirmation via mail and SMS. 

After the auction period, you will receive the allocated bonds in your RBI retail direct account. 

Final Word

RBI investment options like RDG and FRSB allow investors to invest directly with RBI instead of investing through banks. Investors can use the NDS-OM platform of RBI for transacting directly. Adhere to the regulatory guidelines while investing in RBI plans directly to ensure a smooth process.