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[Explained] Investing in government securities: Do they suit your financial goals?


Updated Feb 16, 2021 | 08:26 IST
The RBI has recently allowed direct access in G-secs to retail investors. However, more operational clarity will emerge in the days to come.
Investing in government securities: Do they suit your financial goals? 
Government Securities (G-Secs) are one of the safest investing instruments available in the market. They are issued and backed by the central or state governments. So, they don t carry any default risk. This sovereign guarantee makes G-secs highly attractive for risk-averse investors. But because of the low risks, government securities offer low returns. 
Earlier, retail investors were not allowed to participate directly to invest in the G-secs market and couldn’t open a gilt account which is used to hold the G-secs. However, Reserve Bank of India Governor Shaktikanta Das announced on February 5 that the government will permit retail investors to access the G-secs directly through a dedicated p ....

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