Scheme Name: Gold Monetization Scheme Launch Year: September 2015 Implementing Agency: Reserve Bank of India Key Objective: Intend to mobilize gold held by institutions and households and facilitate its usage for productive purposes. In the long run, the initiative aims to reduce India's reliance on import of gold. Applicability: All Scheduled Commercial Banks (Except RRBs) Eligible Entities Indian Resident (HUFs, Individuals, Partnership Firms, and Proprietorships). Trusts including Exchange Traded Funds and Mutual Funds. Companies and Charitable Institutions State government, central government, any other entity owned by the respective government, etc. Salient features Minimum Gold Deposit: 10 Grams of Raw Gold (Coins, Bars, Jewellery). Exclude stones and other metals. Maximum Gold Deposit: No limit Testing of Gold: An eligible gold depositor can open a Gold Deposit Account with any scheduled commercial bank after completing the KYC procedure. Generally, deposits are made at GMS/CPTC Mobilization, Collection, and Testing Agency (GMCTA). They will test the purity of gold in the presence of the customer, issue deposit receipt, and inform the customer's bank about acceptance of gold deposit. Types of Deposits Short Term Bank Deposit (STBD) Medium Term Government Deposit (MTGB) Long Term Government Deposit (LTGD) Note: With effect from 26th March 2025, Medium and Long Term deposit component has been discontinued. 1. Short Term Bank Deposit: Duration : 1-3 years Minimum Lock-in period: As determined by the respective banks Applicable Interest rate: Determined by banks Principal Repayment: In Gold or INR equivalent at the time of redemption. Interest repayment on maturity: Equivalent INR or Gold in terms of Rupee at the time of deposit. Other Key Aspects: Short-term deposit of gold can be made with designated banks for a period of 1-3 years. Deposits are allowed for broken period, i.e., 1 year 2 month, 2 year 6 month, etc. Quantity of gold will be expressed up to three decimals of a gram. Standard quality of gold will be of 995 fineness. 2. Medium Term Government Deposit Duration: 5-7 years Minimum Lock-in: 3 years Interest rate: 2.25% pa Interest payment: Simple Interest annually, paid on 31st of every year. 3. Long Term Government Deposit: Duration: 12-15 years Minimum Lock-in: 5 years Interest rate: 2.50% pa Interest payment: Simple Interest annually, paid on 31st March every year. From 26th March 2025 onwards, MLTGD has been discontinued. In addition, customers cannot renew their MLTGD deposits. The existing MLTGD are not impacted and will continue to operate until its maturity, unless prematurely withdrawn. Two or more depositors can jointly deposit gold under the scheme. The deposit will be credited to their joint account. Interest on deposits will start accuring after 30 days of receipt of gold at GMCTA/CPTC, or designated bank's branch or from the date of conversion of gokd deposited into tradeabke gold bar, whichever earlier. Source: RBI