Gold is the most precious and appreciated part of our tradition which brings consistency to our wealth also. As the rest of the asset groups fall downhill, it is the only asset that holds true value and admires. There is no way to win profit in it, though, although the amount of physical gold stored in your locker appreciates over time. Owing to security issues, keeping physical yellow metal can also be challenging and having bank locker to hold the same require extra costs. Rather than keeping your gold in your security or charging the bank to hold it in a locker, you can deposit your gold into and make interest on a bank approved by Reserve Bank of India. In addition to receiving interest in your gold, the RBI Gold Monetisation Scheme can be used to bring you the comfort of security that your priced stock is secured.
This Gold Deposit Scheme is just like a bank FD where you need to deposit your physical gold and at the time of maturity, you will get back the yellow metal or the equal value along with interest received on it. It must be mentioned that at maturity the value of the gold would be determined as per the prevailing rates.
What is RBI Gold Monetisation Scheme?
The scheme is aimed at mobilising gold owned by the country’s households and institutions and promoting its use for profitable purposes and, in the long term, reducing the country’s burden on importing gold, according to the RBI’s Gold Monetization Scheme, 2015. Under the scheme, any Indian citizen can make deposits. Two or more qualifying depositors can jointly open a Gold FD. This gold deposits will be subject to the current regulations relating to the mutual operation of bank deposit accounts including nominations. 30 grams of raw gold (bars, coins, jewellery except for stones and other metals) shall be the minimum deposit at any time. Within the scheme, there is no upper limit to deposit. You will start earning interest after 30 days after the receipt of gold at the CPTC or approved branch of the bank and from the date of conversion of gold deposited into purchasable gold bars, as the case may be, whichever is the earlier.
The STBD principal and interest are backed by gold. The principal would be denominated in gold in the case of MLTGD. The interest on MLTGD shall, therefore, be determined in Indian Rupees with respect to the gold price at the time of deposit.
STBD: These deposits shall be made for a short period of 1 to 3 years (with rollover facility) with the specified banks. Deposits can also be permissible for 1 year 3 months; 2 years 4 months 5 days; etc. The interest is 0.50 per cent p.a. for 1-year tenure, interest is 0.55 per cent p.a. for 1 to 2 years deposit tenure, interest is 0.55 per cent p.a. and 0.60 per cent p.a. for tenures over 2 years up to 3 years.
MTGD: This can be made for 5 to 7 years and LTGD for 12 to 15 years, deposits for broken cycles (e.g. 5 years 7 months; 13 years 4 months 15 days; etc.) can also be permitted. Medium-term deposit interest rates are 2.25 per cent per annum and long term deposits 2.50% per fiscal year.
