To avail the benefit, you have to deposit minimum 30 grams of gold in the bank, while there is no limit on maximum deposits.
Traditionally Indians love to invest in gold and wear gold jewellery especially on occasions like marriage, family functions, festivals, social gathering etc. However, due to increasing cases of snatching, theft, robbery etc, wearing gold jewellery or keeping the precious metal at home has become a security hazard.
As a result, people need to hire bank lockers to keep gold safely by paying locker rent as well as by putting some of money in bank fixed deposit (FD) to get lockers sanctioned.
But it causes difficulty in taking ornaments out of lockers before wearing them and keeping the jewellery back in the lockers when the festivities are over.
Moreover, same safety issue would arise for the duration the ornaments are out of the lockers and even in rare case of theft at bank locker, you won’t get any compensation. To cover these risks, you need to have insurance as well.
So, wearing gold jewellery and keeping them safely is a difficult and expensive task.
However, to eliminate all the issues, you may approach the State Bank of India (SBI), which is accepting gold deposits under Gold Monetisation Scheme (revamped Gold Deposit Scheme) at its specified branches, viz. Personal Banking Branch in New Delhi, Chandni Chowk Branch in Delhi, Thyagarayanagar Branch in Chennai, Coimbatore Branch, Hyderabad Main Branch, Bangalore Main Branch, Bullion Branch Mumbai, Ahmedabad Main Branch, Vishakhapatnam Main Branch, Ludhiana Main Branch and Thrissur Main Branch.
By availing the scheme, you would not only eliminate the storage cost, but will also earn some interest. Moreover, the purity and quality of gold will be assessed simultaneously before you deposit it to the bank.
To avail the benefit, you have to deposit minimum 30 grams of gold, while there is no limit on maximum deposits.
Gold is accepted in the form of raw gold i.e. gold bars, coins, jewellery excluding stones and other metals. To get the gold deposited, customers have to submit an application form along with Identification Proof, Address Proof and Inventory Form.
The scheme may be availed by individuals, singly or jointly (as former or survivor), Proprietorship / Partnership firms, HUFs, Trusts including Mutual Funds/Exchange Traded Funds registered under SEBI (Mutual Fund) Regulations, Companies, Charitable institutions, Central Government, State Government or any other entity owned by Central Government or State Government.
Types of gold deposits are primarily categorised into two types – (i) Short-Term Bank Deposit (1-3 years) and (ii) Medium-Term (5-7 years) and Long-Term (12-15 years) Government Deposit.
(i) Short-Term Bank Deposit (1-3 years)
Under the Short-Term Bank Deposit, the lock-in period is 1 year and per annum interest rate for 1 year is 0.05 per cent, above 1 year to 2 years is 0.55 per cent and above 2 years to 3 years is 0.60 per cent. The interest is denominated in gold and paid in equivalent rupees.
(ii) Medium-Term (5-7 years) and Long-Term (12-15 years) Government Deposit
Under Medium-Term Deposit, the lock-in period is 3 years and the rate of interest is 2.25 per cent per annum, while the lock-in period in case of long-term deposit is 5 years and the interest rate is 2.5 per cent per annum. The interest rates are calculated in rupee term with respect to the value of gold at the time of deposit.
You will have the option of redeeming the deposit either in gold or in equivalent rupees. Moreover, you don’t have to pay any capital gain tax, wealth tax and income tax.