In a bid to help temple boards and bulk depositors, Reserve Bank of India has simplified the Gold Monetisation Scheme (GMS).
- It also allowed banks to sell Ashok Chakra embossed gold coins manufactured by government owned MMTC under the “India gold coin” scheme.
Key Highlights of new Simplified Norms:
Direct deposit of gold to refiner – As per the GMS, Banks and refiners has to sign an agreement for scheme. So in respect to this agreement, now banks can let the depositors to deposit their gold directly with the refiners and depositor will get a deposit receipts from a refinery.
- The decision in this regards has been taken due to the demand of temples that are willing to deposit gold under GMS. It would be difficult to move tonnes of gold from their storage centre to a collection centre.
About Choice of interest or gold during redemption
Short term – The Gold deposits made by depositors as a short-term (1-3) would accrue interest in gold units.
- Earlier, at the time of redemption customers had a choice of collecting their interest in cash or gold.
Medium & Long term – In the case of medium (5-7 years) and long-term (12-15 years) gold deposits (MLTGD), principal will be denominated in gold, and the interest will be calculated in rupees with reference to the value of gold at the time of the deposit.
- Earlier, at the time of redemption both the principal and the interest could be collected in cash, at the prevailing value of gold.
The Gold Monetisation Scheme (GMS) was announced in September 2015 to unlock the gold’s value and to get it circulated in financial investments. It helps in mobilize gold held by households and institutions and facilitate its use in productive purposes.