In an aim to curb gold imports and encourage the mobilisation of gold held by households and institutions.
The government has drafted a guidelines for the scheme called as Gold Monetisation scheme.
The main objective of the scheme is to provide a positive stimulus to the gems and jewellery sector in the country by making gold available as raw material on loan from the banks.
Recently, the government also clarified that the interest earned on it would be exempt from income tax as well as capital gains tax.
Also read:Gold Monetisation Scheme: Interest on Deposits to be Tax-Exempt
The scheme requires a vast set-up of infrastructure for facilitating easy and secure handling of gold. So, it will be initially launched in selected cities only.
1) Purity Testing Centres
There are at present 350 Hallmarking Centres that are Bureau of Indian Standards (BIS) certified spread across various parts of the country.
These Hallmarking Centres will act as ‘Purity Testing Centres' for the GMS as they are well equipped to conduct a test of purity of the jewellery in a short span of time.
2) Preliminary Test
In a Purity Testing Centre, a preliminary XRF machine-test will be conducted to tell the customer the approximate amount of pure gold. He will have to fill up KYC and other details to proceed further.
3) Fire Assay Test
On customer consent, gold will be melt for further purification test. Net weight of the jewellery will be taken after removal of stud and dirt. Individuals can check the process as these centres have viewing galleries from where the customer can see the entire process.
4) Deposit of Gold
After the purity results are said, the customer can make a choice between by refusing or accepting. In case if an individual wants to refuse he can do so by paying the nominal fee.
If he wants to proceed, then he will be given a certificate by the collection centre certifying the amount and purity of the deposited gold.
To encourage small household and deposits, the minimum quantity of gold that a customer can bring is proposed to be set at 30 grams.