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BANKS TO SELL GOLD COINS.

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Reserve Bank on Thursday permitted banks to sell India Gold Coins (IGC) with Ashok Chakra minted by MMTC through their branches. It has been decided to allow designated banks to sell the IGCs manufactured by MMTC, RBI said in a notification.

"The terms and conditions shall be as per the contract between the designated bank and MMTC," it said. MMTC has clarified that the gold used for the IGC will be only that mobilised domestically under the existing Gold Deposit Scheme (GDS) and Gold Monetization Scheme (GMS), it said.

Coins are available in denominations of 5 and 10 grams while a 20 gram bullion is also being manufactured by MMTC. 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.

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. Depositors will earn up to 2.50 per cent interest per annum, a rate lower than bank deposits. With the objective to bring down physical buying of gold, the Sovereign Gold Bonds Scheme was launched that offers 2.75 per cent annual interest rate. Buyers will have to disclose their permanent account number (PAN) and other know your customer (KYC) documents.

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Publication:Pakistan & Gulf Economist
Date:Jan 31, 2016
Words:241
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