Gold Deposit Scheme relaunched by SBI

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SBI relanched previously unpopular gold deposit scheme. Those who wish to utilise this scheme may do so with a minimum deposit of 500grams. This scheme is available only at select SBI branches. Currently, only 50 branches across the country have been nominated to accept these deposits .

The gold so deposited with the bank shall be checked for purity and melted at the Government of India mint. A certificate of purity will then be issued by the Government, which can be used by the investor to claim back the gold after the maturity period.
The bank has also clarified that the expenses incurred on assaying of gold shall be borne by the bank and will not be passed on to the customer. During the investment tenure, the deposited gold will earn an interest, which is currently tagged as 1% (3 years), 1.25% (4 years) and 1.5% (5 years).

The investment shall be locked-in for one year. Premature withdrawal, after the lock-in period but before the maturity, shall attract a penal interest of 0.5% if withdrawn within 3 years and 0.25% thereafter. However, interest  is calculated in grams and not in rupees. Thus, an investment of 500 grams of gold for three years shall earn 5 grams of gold as interest per annum, compounded annually.

At the end of the maturity term, the interest so earned shall be converted into rupee equivalent of gold then and paid to the investor. For the principal investment, investor will have an option to claim back pure gold (0.999 purity) or cash equivalent of gold as on that day. You will not get your original jewels deposited .
Interest earned as well as tax on any capital gains arising from rise in price of gold after maturity is exempt from tax. Gold so deposited has also been exempted from wealth tax.

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