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TARGET IAS 2016 BATCH
GOLD MONETISATION SCHEME
Introduction
 The scheme will replace the prevailing gold deposit scheme that started
in 1999.
 Under the new scheme the minimum deposit at any one time shall be
raw gold (bars, coins, jewellery excluding stones and other metals)
equivalent to 30 grams of gold of 995 fineness.
 There is no maximum limit for deposit under the scheme.
 There will be provision for premature withdrawal subject to a minimum
lock-in period and penalty to be determined by individual banks.
Who will test the quality of Gold?
 The gold will be accepted at the collection and purity testing centres
(CPTC) certified by the Bureau of Indian Standards (BIS) and notified by
the central government.
Duration of deposits
 The designated banks will accept gold deposits under the short term (1-3
years) Bank Deposit (STBD) as well as medium (5-7 years) and long (12-
15 years) term government deposit schemes.
 While the shorter term deposits will be accepted by banks on their own
account, whereas Long term deposits will be on behalf of the
government.
Interest rate
 An interest rate of 2.25 percent for medium term deposits and 2.5
percent for the long-term deposits.
What Banks will do with the gold?
  The designated banks may sell or lend the gold accepted under the
short-term bank deposit to MMTC for minting India Gold Coins and to
jewellers, or sell it to other designated banks participating in the
scheme.
Advantages of Gold Monetisation scheme
1. The gold monetisation scheme earns interest for your gold jewellery
lying in your locker. Broken jewellery or jewellery that you don't want to
wear can earn interest for you in gold.
2. Coins and bars can earn interest apart from the appreciation of value
3. Your gold will be securely maintained by the bank.
4. Earnings are exempt from capital gains tax, wealth tax and income tax.
There will be no capital gains tax on the appreciation in the value of gold
deposited, or on the interest you make from it.
5. It will help to control Gold imports
6. It will attract investors away from physical assets.