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Gold Monetization Scheme - All you need to know

Published on Wednesday, September 09, 2015
Recently Finance Minister Arun Jaitley launched Gold Monetization Scheme. Lets know about this scheme.
Gold Monetisation Scheme
  • The main focus of this scheme is to reduce the gold in physical form lying in households and any other entities.
  • Under the Gold Bond Scheme, Gold Bond will issue 500 grams per person per year for the period of 5 - 7 years.
  • According to Sovereign Gold Bond (SGB) scheme, to develop a financial assets as an alternative to Gold.
  • Gold Monetisation Scheme launched especially for channelize country's idle gold assets.

Working of Scheme

  • The RBI issue gold bonds on the behalf of the government.
  • Idle Gold can be deposit in banks for short, medium or long term. Depositories of Gold will earn interest on their metal accounts.
  • Quantity of Gold to be credited in account will depend upon purity of Gold.
  • Bullion as well as Jewellary, is acceptable for deposit.
  • Minimum Limit for deposit of Gold is 30gm.
  • The RBI issue gold bonds on the behalf of the government.
  • The bonds will be issued in 2, 5, 10 grams of gold.
  • Interest on Gold Bonds to be decided by government from time to time.
  • On maturity, redemption will only be in rupees. 
  • Redemption can be done through NBFCs, Banks and Post Office.
  • Risk of Increase in Gold price will be borne by Government.
  • The major benefit of this scheme would be that reduction in Imports of Gold because India imports about 1000 tonnes of Gold.
  • (Another important announcement is that 100% FDI in White Label ATM is allowed).

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