Gold Monetisation Scheme FAQs
What is Gold Monetisation Scheme (GMS)?
The Gold Monetisation Scheme enables individuals (households) and institutions unlock the value in their gold holdings by earning interest, while protecting the basic investment i.e. investment made in gold. The deposit is treated as a term deposit in the form of gold, the principal can be redeemed in INR (at the rate of gold prevailing on the date of redemption for Principal) and interest earned on which will be paid annually (at the rate of gold prevailing on the date of creation of gold deposit).
Can deposits be made in joint names?
Joint deposits of two or more eligible depositors are allowed under the scheme and the deposit in such case shall be credited to the joint deposit account opened in the name of such depositors. The existing rules regarding joint operation of bank deposit accounts, including nominations will be applicable to these gold deposits.
Can I deposit gold at Bank’s branch?
No. All deposits under the scheme shall be made at the Refinery or Refiner's PVC (Purity Verification and testing Centre).
For Retail customers, customer post visiting branch will have to travel to PVC.
For bulk customers, customer post executing the necessary documentation can confirm pick-up date and bank in co-ordination with Refiner’s logistics partner will arrange to pick up gold from customer’s premises.
How will the INR value of my gold deposit be calculated which I will get on maturity?
The Gold will be multiplied with the GOLD-INR price prevailing on the maturity date. The rate is computed considering the RBI Reference rate for USD-INR, GOLD-USD London AM FIX rate and the prevalent custom duty for import of gold. In case of maturity date of deposit falling on a holiday, the previous working day’s rate would be considered.
What is the minimum and maximum tenure for which I can place the deposit?
There shall be two gold deposit schemes as under:
Medium Term Government Deposit (MTGD) with maturity period of 5-7 years
Long Term Government Deposit (LTGD) with maturity period of 12-15 years
Both of these deposits would be held by Bank on behalf of the Central Government of India.
Can I withdraw the deposit prematurely?
Yes subject to the below Minimum lock-in period and revised interest rate conditions.
(i) Minimum lock-in period
A Medium Term Government Deposit (MTGD) is allowed to be withdrawn any time after 3 years and a Long Term Government Deposit (LTGD) after 5 years.
(ii) Penalty on premature withdrawal
The amount payable to the depositor on premature withdrawal shall be calculated as a sum of (A) and (B), as indicated below:
(A) Actual market value of the gold deposit on the day of withdrawal.
(B) Interest payable on the value of the gold for the actual period for which deposit was held (i.e. Start date of deposit till date of withdrawal)
|Features||Medium Term Gold Deposit (MTGD)||Long Term Gold Deposit (LTGD)|
|Current interest rate offered on gold deposit||2.25% p.a.||2.50% p.a.|
|Tenure||5 – 7 years||12 -15 years|
|Minimum lock-in||3 years||5 years|
|Penal interest||>3 and <5 (MTGD interest less 0.375%)
>=5 and <7 (MTGD interest less 0.25%)
|>5 and <7 (MTGD interest less 0.25%)
>=7 and <12 (LTGD interest less 0.375%)
>=12 and <15 (LTGD interest less 0.25%)
What would be the amount and form of gold to be credited in Gold Deposit account?
The designated banks will credit the MTGD/ LTGD, with the amount of 995 fineness gold as indicated in the advice received from PVC, after 30 days of receipt of gold at the PVC. The deposit account will be denominated in grams of gold with quantity mentioned up to 3 decimals.
Can a customer place deposits for broken tenures like 5.5 years, 12.5 years etc.?
No. Only full tenure product is available as of now in multiples of a year. Customer can place deposit for tenure of either 5 years or 6 years or 7 years in MTGD and for 12 years or 13 years or 14 years or 15 years under LTGD.