GOLD MONETISATION SCHEME DISCONTINUED: What It Means for Investors?

New Delhi (The Uttam Hindu): The Central Government has decided to discontinue the Gold Monetisation Scheme (GMS), effective March 26, 2025, citing evolving market conditions. Introduced on September 15, 2015, the GMS aimed to reduce India's reliance on gold imports and mobilize gold held by households and institutions for productive purposes.

Key Components of GMS

The GMS comprised three main components:

Short-Term Bank Deposit (1-3 years): This component will continue but at the discretion of individual banks based on commercial viability.

Medium Term Government Deposit (5-7 years): Discontinued effective March 26, 2025.

Long-Term Government Deposit (12-15 years): Also discontinued effective March 26, 2025.

Existing Deposits and Future Guidelines: Existing deposits under the Medium and Long Term Government Deposit components will continue until redemption, adhering to the existing guidelines. The Reserve Bank of India will provide detailed guidelines on the Short-Term Bank Deposit component.

Performance of GMS

As of November 2024, approximately 31,164 kg of gold had been mobilized under the GMS, with:

7,509 kg under Short-Term Gold Deposit

9,728 kg under Medium-Term Gold Deposit

13,926 kg under Long Term Gold Deposit

About 5,693 depositors participated in the GMS.