Gold deposit scheme should be revised: MMTC-Pamp
Posted on: 05/Nov/2014 11:24:11 AM
MMTC-Pamp has proposed changes to the existing gold deposit scheme which they think could easily unlock tons of household gold stockpiles.
The deposit scheme, introduced in 1999, stipulates that an account can be opened only with an initial gold deposit of 500 grams. MMTC-Pamp has urged the government to reduce the minimum gold requirement from existing 500 grams to 40 grams. According to them, such a move would ensure participation by more households, as the current requirement is well beyond the reach of many average households in the country.
Earlier, the company had conducted a survey of 5,000 households across the country.60% of the respondents stated that they were willing to invest in gold deposit schemes if the minimum deposit requirement is lowered. Estimates suggest that the scheme was able to collect only 15 tonnes of gold until now, drastically lower when considering the fact that nearly 25,000 tonnes still lie idle with Indian households and temple vaults.
According to MMTC-Pamp, lowering the minimum deposit requirement will make the scheme more accepted among general public and help to bring more of the stashed gold into circulation. The refiner notes that even if the schemes are able to liquidate 1% of the gold hoardings, the country will be liberated from its over dependence on gold imports.
