1. Query: Are banks required to obtain RBI approval to participate in the Gold Monetisation Scheme, 2015?<\/p>\n

Response: No. However, banks should submit to RBI the implementation details including names of the CPTCs and refiners with whom they have entered into tripartite agreement and the branches operating the scheme. Banks should also report the amount of gold mobilised under the scheme by all branches in a consolidated manner on a monthly basis in the prescribed format.<\/p>\n

2. Query: Can a deposit under the Scheme be made for 4 years or 8 years?<\/p>\n

Response: 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.<\/p>\n

3. Query: Is it mandatory to complete the KYC for potential customers of GMS prior to depositing gold?<\/p>\n

Response: Yes, unless the potential depositor is already a bank\u2019s KYC compliant customer.<\/p>\n

4. Query: How will a Collection and Purity Testing Centre (CPTC) know that a depositor is already KYC compliant?<\/p>\n

Response: Banks and the CPTCs may put in place a mutually acceptable procedure in this regard and notify that to the relevant CPTCs.<\/p>\n

5. Query: Can a customer get back his jewellery if the purity determined by the CPTC is not acceptable to him\/her and he\/she does not want to invest in the GMS?<\/p>\n

Response: The jewellery will be melted by the CPTC to conduct the fire assay and the customer can get back gold only in post-melted form. The jewellery can be taken back in original form before fire-assaying. Thus, the decision regarding taking back jewellery in original form has to be taken by the customer after XRF test and before giving consent for fire-assaying.<\/p>\n

6. Query: Will the refined amount of gold deposited be credited only after receipt from the customer the Deposit Receipt issued by the CPTC? What if the customer produces the certificate at the bank but no intimation from the CPTC and Refinery has been received?<\/p>\n

Response: No, regardless of the submission of the Deposit Receipt by the customer, the deposit taking bank will credit in the deposit account the amount of refined gold on receipt of intimation from the CPTC about the deposit, and from the Refiner regarding the refined gold being ready for use by the bank, but in any case not later than 30 days from the date of deposit at the CTPC. In cases where the Deposit Receipt is submitted by the customer before receipt of the relevant advice from the CPTC\/Refinery, the bank should make enquiry with these entities and take further action based on the response.<\/p>\n

7. Query: In what form will the depositor get back his gold at maturity?<\/p>\n

Response: If the depositor opts for redemption in the form gold, he will get back physical gold at maturity in the form of bullion.<\/p>\n

8. Query: Is the option of redeeming deposit in gold is available under both short term bank deposits and medium and long term bank deposits?<\/p>\n

Response: No, the option of redemption of the deposit in the form of gold is available only under the Short Term Bank Deposits. The Medium and Long term deposits will be redeemed only in Indian Rupees (INR).<\/p>\n

9. Query: Can a bank make repayment of the partial amount of gold (less than one gram) in INR in cases where the redemption is in gold?<\/p>\n

Response: Yes. In case the maturity amount comes to, say 302.86 grams of gold, and the customer has to be paid in gold, a bank can repay 302 grams in gold and 0.86 grams in equivalent amount of INR.<\/p>\n

10. Query: Who determines the rate of interest on the Medium and Long Term Deposits?<\/p>\n

Response: It will be determined by the Central Government and advised to banks by RBI.<\/p>\n

11. Query: Will a designated bank get any commission for servicing the MLTGD product?<\/p>\n

Response: Yes.<\/p>\n

12. Query: Is it compulsory for banks to participate in the auction of gold collected under the Medium and Long Term Deposit schemes?<\/p>\n

Response: No.<\/p>\n

13. Query: Can a designated bank purchase\/borrow gold from local banks and refiners to replenish the GMS gold at maturity.<\/p>\n

Response: Yes.<\/p>\n

14. Query: Can banks hedge their gold exposures arising from operation of GMS?<\/p>\n

Response: Yes, in international markets.<\/p>\n

November 3, 2015<\/p>\n","protected":false},"excerpt":{"rendered":"

1. Query: Are banks required to obtain RBI approval to participate in the Gold Monetisation Scheme, 2015? Response: No. However, banks should submit to RBI the implementation details including names of the CPTCs and refiners with whom they have entered into tripartite agreement and the branches operating the scheme. Banks should also report the amount of gold … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[14],"tags":[23],"class_list":["post-1306","post","type-post","status-publish","format-standard","hentry","category-investment","tag-gold"],"yoast_head":"\n