At least one third of the public sector bank branches in all towns will have to provide the revamped gold deposit scheme on demand with special designated officers, and the minimum deposit under the scheme has now been reduced to 10 grams from earlier 30 grams, finance ministry said in a notification.
The government will also request the private sector banks to participate in the revamped Gold Monetisation Scheme (GMS) that will incentivise participating jewellers.
According to the revamped GMS, in the first stage, issue of medium-term gold deposit (MTGD) and long-term gold deposit (LTGD) certificates by banks will be moved to a secure digital platform, to be developed by State Bank of India. Thereafter, a regulated securities depository will be designated by SBI to hold the certificates in a digital demat format.
GMS security will be tradable in the market.
Jewellers will be encouraged to set up BIS-approved collection and purity testing centres (CPTCs) under the scheme. Participating banks and refineries will take steps to enter into agreement with sufficient number of CPTCs so that GMS can be offered in significantly larger number of branches.
Banks have also been permitted to buy Indian-refined gold from market and gold exchange under the scheme.
All these changes are expected to revive GMS that has remained a non-starter since its introduction in November 2015.
Mobilising most of the idle gold from Indian households will help the country reduce dependence on import of gold and address the issue of current account deficit.
“The revamped gold monetisation scheme will bring pathbreaking changes in the bullion and jewellery sector with the introduction of GMS security, repayment of GML in terms of Indian refined gold, allowing banks to buy Indian gold through exchanges, ease of GML loan, and reduction of minimum deposit to 10 grams from existing 30 grams,” said Surendra Mehta, national secretary, India Bullion & Jewellers Association.
He said including jewellers in GMS is a major move as Indian households trust their family jewellers and therefore mobilisation of idle gold lying in the lockers will become comparatively easier. “The involvement of jewellers to run GMS scheme shall make the entire scheme consumer-friendly and will benefit jewellers in big way,” Mehta said.
