Jagran Josh Logo
  1. Home
  2. |  
  3. Bank Recruitment|  

General Awareness for Bank Exam: Gold Monetisation Scheme, 2015

Dec 10, 2015 12:54 IST

    IBPS has declared the result CWE PO/MT-V main exam in the month of November. Candidates who qualified in Main examination will be called for a Common Interview to be conducted Participating Organisations and co-ordinated by the Nodal Bank. The interview will be held in January 2016.

    Here the banking team of Jagran josh is providing the details about Gold Monetisation Scheme, 2015 which is useful for IBPS PO interview.

    What is Gold Monetisation Scheme?

    It is a scheme that facilitates the depositors of gold to earn interest on their metal accounts. Once the gold is deposited in metal account, it will start earning interest on the same.

    India is the world's largest buyer of gold with estimated holdings of 20,000 tonnes, worth over Rs 55 lakh crore.  The objective of the scheme is to mobilize a part of an estimated 20,000 tonnes of gold held by households and institutions in the country and to reduce India's reliance on the import of gold.

    A part of the gold collected through the monetisation scheme will be lent or sold to MMTC (Metals and Minerals Trading Corporation of India) and RBI for minting of coins and auction. All scheduled commercial banks have been allowed to offer this scheme. The designated banks are free to fix the interest rates on these deposits.

    How it generally works?

    When a customer brings in gold to the counter of specified agency or bank, the purity of gold is determined and exact quantity of gold is credited in the metal account. The deposited gold will be lent by banks to jewellers at an interest rate little higher than the interest paid to customer.

    How is the interest rate calculated?

    Both principal and interest to be paid to the depositors of gold, will be ‘valued’ in gold. For example if a customer deposits 100 gm of gold and gets one per cent interest, then, on maturity he has a credit of 101 gram. The interest rate is decided by the banks concerned.

    Are banks required to obtain RBI approval to participate in the Gold Monetisation Scheme (GMS), 2015?

    No. However, banks should report the amount of gold mobilised under the scheme by all branches in a consolidated manner on a monthly basis in the prescribed format.

    Can a deposit under the Scheme be made for 4 years or 8 years?

    No. However, a short term deposit initially made for 3 years could be rolled over for another year. The roll over facility is not available for medium and long term deposits.

    Is it mandatory to complete the KYC (Know Your Customer) for potential customers of GMS prior to depositing gold?

    Yes, unless the potential depositor is already a bank’s KYC compliant customer.

    In what form will the depositor get back his gold at maturity?

    If the depositor opts for redemption in the form gold, he will get back physical gold at maturity in the form of bullion.

    Is the option of redeeming deposit in gold is available under both short term bank deposits and medium and long term bank deposits?

    No, the option of redemption of the deposit in the form of gold is available only under the Short Term Bank Deposits.

    Who determines the rate of interest on the Medium and Long Term Deposits?

    It will be determined by the Central Government and advised to banks by RBI.

    Latest Videos

    Register to get FREE updates

      All Fields Mandatory
    • (Ex:9123456789)
    • Please Select Your Interest
    • Please specify

    • By clicking on Submit button, you agree to our terms of use
      ajax-loader
    • A verifcation code has been sent to
      your mobile number

      Please enter the verification code below

    Newsletter Signup
    Follow us on
    X

    Register to view Complete PDF