Gold Monetisation Scheme

Through the Gold Monetisation Scheme (GMS), you can deposit gold in any form, such as jewellery, coins, or bars, at authorised banks, where it is refined at Collection and Purity Testing Centres (CPTCs) before being converted into standard tradable gold bars, ensuring liquidity.

You earn interest on your deposit, and at maturity, you can choose to receive either the gold or its cash equivalent. This scheme helps you make your idle gold productive while contributing to the economy and earning returns on your assets.

This scheme evolved from earlier gold deposit initiatives and allows you to deposit your idle gold for a fixed period. Currently, only Short Term Bank Deposits (STBD) are available, with a tenure ranging from 1 to 3 years.

Similar to a bank deposit, the gold accrues interest while being refined and mobilised. At maturity, you can opt to receive your returns either in gold or in the Indian Rupee equivalent. You may decide this at the time of making the deposit.

This scheme offers a secure and rewarding way to earn returns on your idle gold. Here are its key features and benefits:

• Additional Source of Income

You can earn interest on your deposits, creating an additional stream of income while making idle gold productive.

• Transparency

Gold is tested at authorised CPTCs in the depositor’s presence, ensuring accurate valuation and complete transparency.

• Financial Inclusion

By depositing your idle gold, you can convert physical assets into interest-bearing financial instruments. This can help mobilise household gold and put it to productive use within the economy.

• Gold Assets Mobilisation

The scheme helps mobilise gold held by households, institutions, and trusts, reducing idle holdings and contributing to the financial ecosystem.

• Tax Exemption

The interest income and capital gains from the scheme are exempt from income tax and capital gains tax, as per current income tax laws. This offers you a financial advantage.

• Flexible Redemption

At the time of deposit, you can choose to redeem the principal in either standard gold bars or the Indian Rupee equivalent. 

• Premature Withdrawal

Premature withdrawal or early closure is permitted after one year, subject to penalties and bank-specific terms.

To be eligible for this scheme, you are required to meet the following requirements and provide the necessary documents. 

• Residency: Indian resident

• Applicant type: Eligible categories include:

  • Individuals (single or joint) 

  • Hindu Undivided Family (HUF)

  • Companies 

  • Trusts

  • Proprietorship and partnership firms

  • Charitable institutions

  • Central or state government

  • Any entity owned by the state or central government

• Minimum Deposit: A deposit of at least 10 grams of raw gold is to be made in either bars, coins, or jewellery (excluding stones and other metals)

• Purity Testing: Your gold will be verified for purity at authorised CPTCs in your presence

Required Documents

• Gold Deposit Application Form: Duly filled and signed by the depositor(s)

• KYC Documents: As per the requirements of the designated bank (e.g., PAN, Aadhaar, proof of address)

Earlier, the scheme also included Medium-Term (5–7 years) and Long-Term (12–15 years) deposits. However, these options have been discontinued since 26 March 2025. The Gold Monetisation Scheme currently only offers Short Term Bank Deposits (STBD), designed to mobilise idle gold while earning interest.

Short Term Bank Deposit (STBD)

• Duration: 1-3 years

• Minimum Lock-in Period: 1 year

• Applicable Interest Rate: Determined by the bank and subject to change

• Interest Payment Frequency: As decided by the bank

This scheme provides flexibility, catering to different investment horizons and interest preferences.