The Reserve Bank of India has simplified the Gold Monetisation Scheme (GMS) for bulk depositors, aimed to help temple boards to do so. RBI has also allowed banks to sell Ashok Chakra-embossed gold coins manufactured by government-owned MMTC under the ‘India gold coin’ scheme. MMTC was hitherto selling such coins, introduced last November, only from its 25 centres in the country.

This was a major demand of temple trusts, many having tonnes of gold and willing to deposit part of that under the GMS. Now these depositors need not move gold to a collection centre which could be far away from their storage. Banks may open a branch in an area nearby or the refinery can offer this facility directly to the trust.

 Short Term 

Under the amended norms, gold deposits made by depositors in the short-term bank deposit (STBD) scheme for a period of 1-3 years would accrue interest in gold units. This is a change from the earlier norm where customers had a choice of collecting their interest in cash or gold during the time of redemption.

 Medium & Long Term 

In the case of medium and long-term gold deposits (MLTGD), where medium-term deposits have a 5-7 year term and long-term deposits have a 12-15 year term, the central bank’s notification said that while the principal will be denominated in gold, the interest will be calculated in rupees with reference to the value of gold at the time of the deposit.

Earlier, both the principal and the interest could be collected in cash, at the value of gold prevailing at the time of redemption of the deposit.

 Did You Know??? 

Under the Gold Monetisation Scheme (GMS), 2015, banks will collect gold for up to 15 years to auction them off or lend to jewellers from time to time. India imports a staggering 1,000 tonnes of gold every year, draining out foreign exchange and putting pressure on the fiscal deficit. An estimated 20,000 tonnes of gold worth over Rs 52 lakh crore is lying with households and temples.

 Inclusive Learning – Secret of Success 

• Hitherto means until now or until the point in time under discussion.
• Stagger means surprise.
• Redemption means the action of saving or being saved.
• Emboss means carve or mould
• Prevail means prove more powerful or superior.
• Amend means make minor changes.