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Depositors of gold monetization scheme can redeem in gold

The government has added a new feature to its gold monetization scheme, as per reports. For the gold deposits under Medium and Long Term Government Deposits (MLTGD), ‘redemption of principal amount at maturity shall, at the option of the depositor, be either in Indian Rupee equivalent of the value of deposited gold at the time of redemption or in gold’, as per the Finance Ministry, reports add.

The tenure of Medium Term Government Deposit (MTGD) is between 5-7 years and Long Term Government Deposit (LTGD) between 12-15 years. This initiative by the government is expected to inspire temple trusts to depositing gold under the gold monetization scheme, as many temple trusts have significant amounts of gold with them. The redemption will attract an administrative charge of ‘0.2 per cent’ of the notional redemption amount to be levied from the depositor in Indian rupees. The interest applicable on the scheme will be calculated as per the value of gold in Indian rupee at the time of deposit and will be paid in cash.

Courtesy: Diamond World