How to buy Government bonds in Zerodha?

Before investing in Government securities (G-Secs), let’s first understand the advantages of investing in Bonds or T-Bills.

  • Government securities (G-Secs) with a maturity period greater than one year are called Bonds.
  • Government securities (G-Secs) with a maturity period of less than one year are called Treasury bills (T-Bills).

Advantages of investing in Government Securities (G-Secs)

  • No Tax deduction at source (TDS) compared to bank’s fixed deposits. Pay taxes as per your income tax slab only.
  • (G-Secs) is backed by the Government of India, So your investment is always safe.
  • Better Returns compared to bank’s fixed deposits with attractive interest rates.
  • Long investment period option up to 40 years compared to bank’s fixed deposits that offer only a maximum tenure of 10 years.
Credit: Zerodha

How to buy Government bonds (G-Secs) in Zerodha?

Every week exchanges open a non-competitive bidding window for Government securities. You can apply to the bidding with your Zerodha account, and the funds will be deducted from your Zerodha account.

Bids Timing for Bonds (G-Secs): Tuesday to Thursday

Bids Timing for Treasury bills (T-Bills): Monday to Tuesday

After the successful transaction of Bonds or T-Bills, Government securities will be credited to your Zerodha Demat Account.

Interest will be credited directly to your bank account.

How much Zerodha charges for Government bonds or (T-Bills) 

 (G-Secs) investment? 

0.06% or 6 Rs for every 10,000 Rs invested will be charged.

How to sell or exit Government Bonds or (T-Bills)?

Now you can sell or exit Government bonds just like stocks. They are now available on the exchanges.

 T-bills are not available on the exchanges and premature exit isn’t possible, you will have to hold them till maturity.

If you want to Know about the different types of bonds in India? Click here

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