Sovereign gold bonds are not just like any other government bond. These are bonds backed by gold. Every unit of SGB is backed by one gram of gold. These are issued by the Reserve Bank of India (RBI) on behalf of the Government of India. SGBs come with a coupon of 2.5% interest per annum, which is paid semi-annually. These have a maturity period of eight years but are open for redemption with RBI after the end of five years. These are also listed on the stock exchanges and can be traded on exchanges.