You are here: Home » Budget » Reactions » Financial Sector
Business Standard

Gold deposit scheme can fetch Rs 1 trillion: SBI Research

It will be a "game changer" by incentivising the banks to hold a part of the deposits as part of the mandatory cash reserve ratio or the statutory reserve ratio, said the

Press Trust of India  |  Mumbai 

Describing the proposed gold deposit scheme as "game changer", the SBI's economic research department has said it will help attract at least Rs 1 trillion in deposits on the precious metal.

"The proposed introduction of a gold deposit scheme is a big positive and conservative estimates show that the monetary value of gold deposits mobilised may be at least Rs 1 trillion," it said in note today..

Read our full coverage on Union Budget

It will be a "game changer" by incentivising the banks to hold a part of the deposits as part of the mandatory cash reserve ratio or the statutory reserve ratio. This may free up resources for productive or lending purposes, it said.

The conservative estimates show even at a 30% strike rate, the monetary value of gold deposits mobilised may be as much as Rs 3 trillion, it said.

According to the note, the new scheme will help depositors of gold earn interest and jewellers to obtain loans on their metal accounts.

In the speech, Jaitley had introduced multiple measures to monetise gold, including the gold monetisation scheme, a sovereign gold bond and developing an Indian gold coin which will have the Ashok Chakra.

"We are one of the largest consumers of gold in the world and import as much as 800-1,000 tonnes each year. Though stocks of gold in India are estimated to be over 20,000 tonne, mostly this gold is neither traded, nor monetised," he said in the speech.

It can be noted that these imports resulted in problems on the external front, where the current account deficit expanded which led to a heavy fall in the rupee.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sun, March 01 2015. 16:57 IST
RECOMMENDED FOR YOU