SBI Gold Deposit Scheme: All You Need To Know About

The State Bank of India (SBI) provides the Revamped Gold Deposit Scheme (R- GDS), which is a gold-based fixed deposit. Gold holders can store their unused gold with R- GDS, which will allow article security, interest payment, and other benefits. Let's discuss in brief SBI's Revamped Gold Deposit Scheme (R-GDS).

Features and benefits

• Customers can earn interest in their dormant gold assets by engaging in this scheme.
• This scheme comes with Short Term Bank Deposit (STBD) with tenure ranging from 1 to 3 years, Medium Term Government Deposit (MTGD) of tenure ranging from tenure 5 to 7 years and Long Term Government Deposit (LTGD) with tenure ranging from 12 to 15 years.
• On behalf of the Central Government, the SBI will accept the deposit of eligible customers.
• A deposit quantity of at least 10 grammes with no upper limit of raw gold bars, coins, or jewellery, excluding stones and other metals, is allowed under the scheme for deposit.
• Individual contributions in single names are eligible for the nomination facility also.
• Currently the rate of interest for STBD will be 0.50% p.a. for 1 year, 0.55% p.a for above 1 year up to 2 years and 0.60% p.a for above 2 years up to 3 years. On STBD a, the principal will be valued in gold and the interest on STBD, on the other hand, will be computed in Indian Rupees, based on the worth of gold at the time of deposit.
• For MTGD the rate of interest charged will be 2.25% p.a and on LTGD the rate of interest will be 2.50% p.a.
• The principal will be valued in gold in the case of MTGD & LTGD. The interest, on the other hand, will be paid in Indian Rupees on the 31st of March each year, or at the maturity date, whichever comes first.
• On maturity, the depositor will have the alternative of receiving simple interest or cumulative interest (compounding yearly). The selection must be made at the time of registration of the deposit.

Eligibility Criteria

Here are the eligibility criteria of the scheme that resident Indian depositors must need to know:

• Individuals, singly or jointly (as Former or Survivor)
• Proprietorship & Partnership firms.
• HUFs
• Trusts including Mutual Funds/Exchange Traded Funds registered under SEBI (Mutual Fund) Regulations
• Companies
• Charitable institutions
• Central Government
• State Government or any other entity owned by Central Government or State Government
• Gold will be approved in its purest form, such as gold bars, coins, and jewellery, rather than stones or other metals. Customers must submit an application form attached with proof of identification, proof of address, and an inventory form at the time of making the deposit.

Repayment

STBD: This option is allowed to get principal repayment in gold or equivalent rupees at the time of maturity.

MTGD & LTGD: The deposit will be redeemed in gold or the INR equivalent of the gold value at the time of redemption. Upon redeeming in gold, however, there will be a 0.20 percent administrative fee.

Premature payment

STBD: Allowable after a one-year lock-in term with a penalty on the relevant interest rate.

MTGD: Withdrawal is permitted at any time after three years with a penalty on interest.

LTGD: Withdrawal is permitted at any time after 5 years, with an interest penalty.

Gold deposit certificate

• Gold Deposit Certificate will be issued and granted by Nodal Branch (i.e. Bullion Branch, Mumbai).
• The certificate will be provided for the contents of pure gold (i.e. in 995 purity).
• Nodal Branch, i.e. Bullion Branch, Mumbai, shall send Gold Deposit Certificate (GDCs) to the depositor.
• Interest will commence accruing on deposits under the scheme 30 days after the gold is deposited or when it is converted into marketable gold bars after refining, whichever comes first.

Interest rate on Gold Related Products for last 10 years (in %)

Scheme	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021
Gold Deposit Scheme								Oct-15
Scheme A (3 Year)		1	0.75	0.75	0.75	0.75	0.75	0.5
Scheme B (4 Year)		1.25	1	1	1	1	1	0.75
Scheme C (5 Year)		1.5	1	1	1	1	1	0.75
Revamped Gold Deposit Scheme								Nov-2015
Scheme A (1 Year)								0.5	0.5	0.5	0.5	0.5	0.5	0.5
Scheme A (2 Year)								0.55	0.55	0.55	0.55	0.55	0.55	0.55
Scheme A (3 Year)								0.6	0.6	0.6	0.6	0.6	0.6	0.6
Scheme B (5-7 Years)								2.25	2.25	2.25	2.25	2.25	2.25	2.25
Scheme C (12-15 Years)								2.5	2.5	2.5	2.5	2.5	2.5	2.5
Source: Bank Website