The government has notified a new 7.75 per cent taxable bond scheme for retail investors.
These bonds with seven-year maturity will open for subscription from the 10th of this month.
Economic Affairs Secretary Subhash Chandra Garg in a tweet said, the saving bonds scheme will replace the previous 8 per cent Scheme.
The interest will be payable half-yearly and the cumulative value of 1,000 rupees at maturity will be 1,703 rupees.
These bonds issued at par are meant for individual other than Non-Resident Indians and are not tradeable in the secondary market and are also not eligible as collateral for loans from banking institutions, non-banking financial companies or financial institutions.
In 2003, the government came out with bonds offering 8 per cent interest to encourage retail investors to invest.
These non-transferable bonds will be exempt from wealth-tax under the Wealth Tax Act.