Gold monetization scheme
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Transcript of Gold monetization scheme
GOLD MONETIZATION
SCHEME
CONTENTO MEANINGO OBJECTIVEO SCHEMEO DRAFT OF GOLD MONETIZATION SCHEMEO MoU BETWEEN BANKS, REFINERIES AND
PURITY TESTING CENTERSO COINS FOR GOLD MONETIZATION SCHEMEO ROADBLOCKSO BENEFITSO REFERENCES
MEANING The gold monetization scheme is the simpler form of the gold deposit scheme of SBI. The government has designed Gold Monetization Scheme to reduce the gold import.The MOF (Ministry of finance) hopes by this strategy to reduce the CAD (Current Account Deficit) caused due to the gold import that has mounted to 87.8 US dollars and is a whooping 4.7% of the GDP.
OBJECTIVEThe objectives of the Gold Monetization Scheme are:i. To mobilize the gold held by households
and institutions in the country.ii. To provide a fillip to the gems and jewellery
sector in the country by making gold available as raw material on from the banks.
iii. To be able to reduce reliance on import of gold over time to meet the domestic demand
SCHEMEO The draft outline of the scheme
detailed in this section, has been prepared after due deliberations and consultations with various stakeholders which includes banks, refineries, hallmarking centres, jewellers’ associations; RBI; and various government departments.
DRAFT OF GOLD MONETIZATION SCHEME
O 1. PURITY VERIFICATION AND DEPOSIT OF GOLD
i) Purity testing centresii) Preliminary testiii) Fire assay testiv) Deposit of goldv) Conditions
O 2. OPENING OF GOLD SAVINGS ACCOUNT
i) Gold savings accountii) Interest payment by banksiii) Redemptioniv) Tenurev) Tax exemption
O 3. TRANSFER OF GOLD TO THE REFINERS
i) Refineriesii) Transfer of gold to refineriesiii) Payment
O 4. UTILIZATION OF DEPOSITED GOLD
i) CRR/SLR
ii) Foreign currency
iii) Coins
iv) Exchange
v) Lending to jewellers
O 5. LENDING THE GOLD TO THE JEWELLERS
1. Gold loan account
2. Delivery of gold to jewellers
3. Interest received by banks
MoU BETWEEN BANKS, REFINERIES AND PURITY
TESTING CENTERO The banks will enter into a tripartite MoU
with refiners and purity testing centres, that are selected by them to be their partners in the scheme.
O The MoU will clearly lay down the details regarding payment of fee, services to be provided, standards of service and the details of the arrangements between the banks, refiners and purity testing centres.
COINS FOR GOLD MONETIZATION SCHEMEO Coins to be manufactured in October.O Will allow depositors of gold to earn
interest on their metal accounts.O Coins of 5gm and 10gm weight
would have Ashoka Chakra and face of Mahatma Gandhi.
O Coins to be sold in the USA, UK and South Africa.
ROAD BLOCKSO Enticing the investors to give
holdings for recasting is a huge challenge
O Customer loses out on the making charges
O KYC stipulation of the banksO Tedious process
BENEFITS1. BENEFIT TO THE INVESTORSO Interest on gold that are kept in
lockersO Increase gold holdingO Exemption from income tax, wealth
tax and tax on capital gains2. GOLD AND JEWELLERY INDUSTRY3. BANKS
GAINERSO Gold and jewellery industry O Banks
REFERENCE• https
://in.finance.yahoo.com/news/gold-monetization--what-it-means-095100975.html
• https://mygov.in/sites/default/files/master_image/Draft_Gold_Monetization_Scheme.pdf
• http://timesofindia.indiatimes.com/business/india-business/Govt-nod-for-gold-bonds-new-monetization-scheme/articleshow/48893027.cms
• http://www.valuewalk.com/2015/09/indias-two-new-gold-schemes-could-narrow-cad-macquarie/
• http://www.civilserviceindia.com/subject/Essay/gold-monetization-scheme9.html