Gold Monetisation Scheme, Sovereign Gold Bonds Scheme, Indian gold coin launched

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November 5, 2015 9:50 PM

Three gold schemes were launched today. The Gold Monetisation Scheme (GMS), 2015 will offer option to resident Indians to deposit their precious metal and earn an interest of up to 2.5 per cent...

Three gold schemes were launched today. The Gold Monetisation Scheme (GMS), 2015 will offer option to resident Indians to deposit their precious metal and earn an interest of up to 2.5 per cent; while under the Sovereign Gold Bonds Scheme, investors can earn an interest rate of 2.75 per cent per annum by buying paper bonds. The first ever Indian gold coin & bullion was also unveiled. “These schemes will be transformative for the Indian gold industry. However, the expectations from the schemes in the short term must be tempered as it will take time to build the infrastructure and products and for customer acceptance to grow,” said World Gold Council MD (India) Somasundaram PR. Here are top 5 points you must know:

1. The Gold Monetisation Scheme will replace the existing Gold Deposit Scheme, 1999. However, the deposits outstanding under the Gold Deposit Scheme will be allowed to run till maturity unless the depositors prematurely withdraw them.

2. The minimum deposit for the raw gold (bars, coins, jewellery excluding stones and other metals) should be equivalent to 30 grams of 995 fineness – there is no maximum limit for deposit.

3. With regard to gold bonds, the RBI in consultation with the Centre has decided to issue such instruments carrying an annual interest rate of 2.75 per cent.

4. Applications for the bonds will be accepted from November 5-20 and bonds will be issued on November 26. These bonds will be sold through banks and designated post offices.

5. The borrowing through issuance of such bonds will form part of the government’s market borrowing programme.

6. Aimed at providing an alternative to buying physical gold, the bonds scheme will offer investors a choice to buy bonds worth 2 grams of gold, up to a maximum of 500 grams.

7. This is the first tranche of the gold bond scheme and subsequent tranches would be notified later.

8. The tenor of the bond will be for a period of eight years with exit option from fifth year to be exercised on the interest payment dates.

9. The Sovereign Gold Bond scheme offers host of benefits including additional interest of 2.75 per cent per annum on the initial purchase price, said Nitin Chugh, Head, Digital Banking, HDFC Bank.

10. Yes Bank  launched the Sovereign Gold Bonds Scheme at major branches across the country and is in the process of fine-tuning its launch of the Gold Monetisation Scheme.

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