For risk-averse investors, SIPs in government bonds as close to a guaranteed return as one can get: Shweta Jain
, Founder,
Investography
,
says for
risk-averse investors
seeking short-term options, bond SIPs offer near-guaranteed returns backed by the Indian government. With maturities ranging from three months to a year and a minimum investment of Rs 25,000, these SIPs are ideal for parking funds intended for short-term needs. Investors can stagger maturities, roll over investments, or withdraw profits while reinvesting the principal.
Let us get the background of this particular platform that is launched by RBI. It has been launched sometimes back and the awareness level is still really low because a lot of time investors do not know how to access it and what kind of products one can buy from these platforms. Give us a sense of this retail direct platform where investors can directly invest into government securities.
Shweta Jain:
It is interesting because this was launched to increase retail participation. Investors can now invest in T-bills directly and through different sorts of periods – 14-days, 91-days. There are different periods that they can do as well. But the awareness is quite low because not much effort is taken to promote it.
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Top 15 Most Beautiful Women in the World
Topgentlemen.com
Undo
I want to understand this from a
financial planning
angle now. We are talking about doing SIPs in treasury bills. What kind of investors should be going to these platforms? If at all they are investing in these kinds of products, what should be the average return expectation? Should return or profit be the priority when you are investing in these kinds of investment instruments or just safeguarding your money should be the priority?
Shweta Jain:
I am going to take the questions one by one. One, this is for an investor who is looking at
short-term investments
. This is not for somebody who is looking long-term. This is for somebody who is absolutely risk-averse. This is as close to a guaranteed return that you can get because the Indian government is promising to repay you at a later date, that is literally what it means. So, this comes with different maturity days. Ideally if you have a three-month horizon for example, a 91-day T-bill will suit you or a 182 days T-bill will suit somebody who has 6 months and 364-day somebody who has a year's horizon.
Also the minimum amount should be about Rs 25,000. The other quite interesting thing is the way the SIP has been promoted and the fact that some of these can be used to either stagger your maturity or keep rolling these investments. It is also interesting for somebody who may be looking at short-term requirements, not necessarily deployed anywhere else because it is short term, say three months. The money might be lying in the bank, and so this is a great use. It is also quite interesting for somebody, who might need the money after three months, and who may not want to roll this over.
It could be that they do this for three months and then withdraw the gain and then invest the principle again, for any of the tenures. It could be that you are taking out a little bit of profit.
Live Events
You Might Also Like:
Bond SIPs offer better returns for risk-averse investors at around 5.5% interest: Suresh Darak
Looking at the bouquet that has been offered in RBI retail direct platform, which are the ones you would recommend for a long-term investment perspective? Considering these are mostly
debt instruments
and when we talk about financial planning or your portfolio planning, it is important to give that balance and stability in your portfolio through a debt investment. Among all of these investment instruments available in this bouquet, which ones would you prefer from a long-term perspective? How can you strategise these instruments for a long-term goal perspective?
Shweta Jain:
Absolutely. When goals are nearer, you want to withdraw the risk element out of it and these products can be a great help to mitigate that risk. Somebody who is absolutely risk averse or someone just starting can start SIP into these instruments. This SIP will be more comfortable for them and then they can go on towards long-term investments.
For somebody who is looking at a hybrid portfolio, I would not recommend it, but somebody who wants to invest safely outside of FDs and RDs, this is a great opportunity.
Since we are talking about a full-fledged investment strategy in these instruments, it is very important to caution our investors in terms of risk. We know no investment is risk-free. What are the risks associated with these investments as well?
Shweta Jain:
One is something which I would call the liquidity risk. While you can sell it in the secondary market, you are basically restricted to the amount of time that you have committed for. You can try and sell it in the secondary market, but that is the liquidity risk that you are talking about. It could be something that may be difficult to sell and that I would definitely call a risk. There are no other risks in terms of credit risk.
The other risk of course is the interest rate risk. If the interest rate falls or rises tomorrow, like if the interest changes, then your earlier bonds might become more expensive or your future bonds might become more expensive. That could happen as well or could be more attractive, expensive or attractive. I think that interest rate risk is something that you could carry as well. But the best part is most new investors look at SIPs and link it to mutual funds. But because mutual funds are subject to market risk, they may not enter that, but here the SIP is in T-bills and so it could be a great entry point and then get into other longer duration investments whether it is equity or debt, whether it is mutual funds or other products.
You Might Also Like:
Now you can do SIPs into T-bills via RBI's retail direct platform; know how will it work and should you go for it
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Indian Express
22 minutes ago
- Indian Express
Trump tariffs: Why gem & jewellery sector fears rivals could undercut Indian exports
Facing a sharp blow from the US' steep tariff hike, India's gem and jewellery export industry has sought government intervention to cushion the impact and sustain its competitiveness in global markets. The sector finds itself at a crossroads, as rivals like Turkey, Vietnam and Thailand continue to enjoy significantly lower tariffs, making Indian products less attractive in the lucrative American market. The US accounts for nearly 30 per cent — or close to $10 billion — of the total gem and jewellery exports. Kirit Bhansali, chairman of the Gem & Jewellery Export Promotion Council (GJEPC), warned that unless corrective action is taken, India risks losing its hard-won position as a key supplier to the US. The threat isn't just financial — it's strategic. Bhansali expressed concern that international trade may start rerouting via low-tariff countries like Mexico, Canada, UAE, Oman and Turkey, undermining transparency and sidelining legitimate Indian players. This is particularly alarming since 85 per cent of exports from the SEEPZ Special Economic Zone — that employs over 50,000 people — are to the US. For cut and polished diamonds, the US remains the market for nearly half of India's total exports. A prolonged tariff standoff, Bhansali warned, could bring the industry to a grinding halt. The industry has asked the government to roll out a targeted scheme — similar to the Duty Drawback — that would reimburse 25–50 per cent of the new US-bound tariff burden between August and December 2025. GJEPC believes this is vital to prevent disruption across the value chain, stretching from artisanal karigars to large-scale manufacturers. In addition to tariff relief, exporters are calling for temporary financial breathing space. They've requested a six-month deferment on interest payments, a measure that echoes the pandemic-era support extended by lending institutions. With cancelled orders threatening to lock up working capital and push units towards non-performing asset (NPA) status, the Council has urged the government to allow SEZ units to release unsold stock into the domestic market. The sector is also grappling with shipment delays triggered by global uncertainty. To address this, banks are being asked to extend pre-shipment loan due dates by 90 days without penalties. The GJEPC has also called for the reintroduction of the interest subvention scheme, which could offer much-needed liquidity during a period of heightened risk. It has asked both the Centre and the RBI to consider short-term relief packages tailored to the sector's needs. Ironically, while the threat looms large, recent data points to a short-term spike in trade. Gross exports of gems and jewellery rose by nearly 16 per cent in July 2025, reaching $2.18 billion (Rs 18,756 crore), up from $1.88 billion (Rs 15,700 crore) a year ago. Imports too surged 26.5 per cent, as traders rushed to complete orders before the tariff hike took effect in August. A similar surge was seen in cut and polished diamond exports, which jumped nearly 18 per cent to $1.07 billion (Rs 9,230 crore), largely due to pre-emptive stocking by global buyers. This uptick, however, may be short-lived. Colin Shah, MD of Kama Jewelry, termed July's performance as a 'cautionary uptick' — a final flourish before the sector feels the full weight of tariff-induced drag. While new trade agreements like the India-UAE CEPA have unlocked opportunities, the broader landscape remains volatile. High gold prices, geopolitical uncertainty, and unstable metal markets continue to cloud the outlook, he said. The festive and wedding seasons in India may help absorb some of the shock by boosting domestic demand. But for the export-reliant segment, all eyes are now on the trajectory of India-US trade negotiations. With the current 50 per cent tariffs in place, sustaining recent growth could prove difficult, and industry leaders are hoping that policymakers will step in before the sparkle fades.
Indian Express
22 minutes ago
- Indian Express
Businessman cheated: Court rejects anticipatory bail plea of accused in Rs 43 crore ‘dabba trading'
In a case filed by the police for alleged cheating of a city-based businessman to the tune of nearly Rs 43 crore in 'dabba trading', a court has rejected the anticipatory bail plea of the accused. A case was filed by the L T Marg police against Ladulal Kanther, his son Pallav Kanther and nephew Shubham Mahavir Kanther earlier this month on allegations that they had cheated the complainant businessman. The court rejected the pre-arrest bail plea of Shubham on Thursday. 'The investigation is at initial stage. Yet the huge quantity of gold and money is to be recovered. The offence is of a serious nature. A detailed investigation is necessary. The possibility of tampering with prosecution evidence cannot be ruled out,' the court said. The allegations against the accused are that they had met the complainant through a chartered accountant and presented themselves to be engaged in trading of gold and silver through their firms, Maxis Bullion and Pallav Gold, with the promise of good returns on their investments. It was alleged that the complainant had initially invested Rs 2.2 crore which was repaid by the accused and subsequently invested 36.4kg gold and Rs 10.51 crore in cash between 2023 and 2024. The accused delayed repayment business citing slowdown due to gold price fluctuations and assured repayment once operations normalised. As the repayment kept getting delayed, the accused admitted to have invested in an illegal speculative gambling activity, referred to as dabba trading, for betting on stock prices outside the exchange. The complainant alleged that cheques issued by the accused for repayment too were dishonoured. Shubham in his plea claimed that he was falsely implicated and that this was not a criminal case but a civil dispute. The court said that a probe is necessary into the allegations and rejected the plea.
Mint
22 minutes ago
- Mint
India's ‘Next Gen GST' may pave way for single tax slab System: Report
Senior government officials have described the proposed GST tax reforms as 'Next Gen GST', a significant overhaul that could eventually pave the way for a single sales/services tax rate by 2047. The proposal, if approved by the GST council, aims to replace the current four-slab structure in the goods and services tax (GST) regime with a two-slab regime, featuring rates of 5 per cent and 18 per cent, while also retaining a 40 per cent tax on 'sin goods.' This new system would eliminate the 12 per cent and 28 per cent tax brackets, PTI reported. The primary goal of this reform is to boost the economy and also serve to mitigate tariff threats. Calling it the "next Gen GST', one government official said "it is a game changer reform. In the pantheon of economic reforms seen in India, it's right up there." said officials who spoke to PTI. They also said the new structure would mean that almost all of the common use items will move to the lower tax bracket, leading to price cuts, which in turn would boost consumption. The changes are a result of nearly six months of extensive deliberations and meetings, with an aim of creating a stable tax environment and preventing the accumulation of input tax credit (ITC). The new structure is designed to cater to the needs of the middle class, poor, farmers, and MSMEs in mind. Daily use items, such as packaged food, beverages and apparel would be moved to the lower 5 per cent from 12 per cent bracket to boost consumption of these products. "Once the system is put in place and India becomes a developed nation, we can think about a single rate GST," said the official, adding that a single rate structure is suitable for developed countries where income and spending capacities are uniform. "We have looked at every item, item by item and in some cases we have gone back and forth 3-4 times. Whether it is pesticide for use by farmers or pencils for students or some raw material or intermediaries for MSMEs, every item has been discussed threadbare and categorized in the merit or standard slab,' the official said. According to the proposal, a significant number of items would be re-categorized: 12 to 5 per cent: As many as 99 per cent of the items in the 12 per cent category such as butter, fruit juices and dry fruits would move to 5 per cent tax rate. 28 to 18 per cent: About 90 per cent of the items currently taxed at 28 per cent, including electronic items like ACs, TVs, fridges, and washing machines as well as other goods like cement will be moved to the 18 per cent slab. The Council is expected to meet next month to deliberate on the tax reform proposal. The move comes after US President Donald Trump imposed an additional 25 per cent tariff on all goods India exports to the US, bringing the total to 50 per cent from August 27 to punish New Delhi for its crude oil purchases from Russia. The tariffs are likely to impact $40-billion of non-exempt Indian exports such as that of gems and jewelry, textiles and footwear. Prime Minister Narendra Modi in his Independence Day address to the nation on Friday emphasized that India should become self-reliant and consume what is made in India, PTI reported.
