Bonds

RBI Floating Rate Savings Bonds

7-year taxable bond at NSC rate + 35 bps, reset half-yearly.

What it is

Floating Rate Savings Bonds 2020 (Taxable): individuals and HUFs (no NRIs) invest from Rs.1,000 with no maximum, earn half-yearly interest on 1 Jan and 1 Jul, and redeem after 7 years. Coupon resets at the prevailing NSC rate plus 35 bps — 8.05% on 1 Jan 2024.

Min ticket: Rs.1,000 face, no maximum · Bond Ledger Account (demat)

How to buy it

Subscribe at SBI, nationalised banks, IDBI, Axis, HDFC, ICICI or SHCIL in Bond Ledger Account form.
Interest is non-cumulative — paid out half-yearly, never compounded.
Senior citizens get early-redemption windows; everyone else holds 7 years.

Costs

No scheme fees
No compounding — payouts sit idle unless reinvested

Liquidity

Not tradeable, not loan-eligible; premature redemption only for senior-citizen brackets.

Regulation

Government of India scheme; RBI notification + receiving-office terms (SBI desk).

Risks that bite

Coupon resets down when NSC rates fall
Interest fully taxable at slab

Read the SBI bond desk terms →

Tax FAQ

How is RBI Floating Rate Savings Bonds taxed?

Interest is taxed at your slab. Transfer or redemption gains follow the post-23-Jul-2024 rules: listed paper held over 12 months is LTCG at 12.5% without indexation, short-term gains join income at slab, and unlisted bonds are always deemed short-term under section 50AA.

Educational, not advisory — and never a quote. LetsInvest is a research publication, not a SEBI-registered investment adviser, and we run no bond-price or yield feed. YTM, ladder and tax outputs are illustrations of numbers you enter. Confirm anything that matters on RBI Retail Direct or the issuer's offer document before you act.

Sources

Reviewed 24 Sept 2026. Yields move — the RBI portal, CCIL and the tax department are the authority, and this hub links straight to them.

RBI - Floating Rate Savings Bonds press release (PRID 53020; 2021-2022/1465, 31 Dec 2021)FRSB 2020 (Taxable): NSC rate + 35 bps spread, reset half-yearly from 1 Jan 2021.
SBI - RBI Floating Rate Savings Bonds desk (receiving-office terms)Eligibility (individuals + HUF, no NRIs); demat form in a Bond Ledger Account only; Rs.1,000 minimum, no maximum; 7-year tenure; half-yearly interest (8.05% on 1 Jan 2024); non-cumulative, non-tradeable, not loan-eligible.
CBDT - FAQs on the new capital-gains regime (PIB, 24 Jul 2024, PRID 2036604)Two holding periods since 23 Jul 2024 (12 months listed, 24 months other); other-LTCG at 12.5% without indexation.
Income Tax Department - Tax on sale of debentures (as amended by Finance Act, 2026)Post-23-Jul-2024 holding table (listed debentures/G-secs: 12 months; unlisted: deemed STCG).
Income Tax Department - Section 50AA (special provision for specified securities)Unlisted bonds/debentures transferred, redeemed or matured on/after 23 Jul 2024 are deemed short-term.

What it is

Min ticket: Rs.1,000 face, no maximum · Bond Ledger Account (demat)

Tax FAQ

How is RBI Floating Rate Savings Bonds taxed?

Sources

Reviewed 24 Sept 2026. Yields move — the RBI portal, CCIL and the tax department are the authority, and this hub links straight to them.

RBI - Floating Rate Savings Bonds press release (PRID 53020; 2021-2022/1465, 31 Dec 2021)FRSB 2020 (Taxable): NSC rate + 35 bps spread, reset half-yearly from 1 Jan 2021.

SBI - RBI Floating Rate Savings Bonds desk (receiving-office terms)Eligibility (individuals + HUF, no NRIs); demat form in a Bond Ledger Account only; Rs.1,000 minimum, no maximum; 7-year tenure; half-yearly interest (8.05% on 1 Jan 2024); non-cumulative, non-tradeable, not loan-eligible.

CBDT - FAQs on the new capital-gains regime (PIB, 24 Jul 2024, PRID 2036604)Two holding periods since 23 Jul 2024 (12 months listed, 24 months other); other-LTCG at 12.5% without indexation.

Income Tax Department - Tax on sale of debentures (as amended by Finance Act, 2026)Post-23-Jul-2024 holding table (listed debentures/G-secs: 12 months; unlisted: deemed STCG).

Income Tax Department - Section 50AA (special provision for specified securities)Unlisted bonds/debentures transferred, redeemed or matured on/after 23 Jul 2024 are deemed short-term.