India, being one of the largest consumers of gold globally, has seen a surge in innovative investment options, particularly gold savings schemes.
These schemes, offered by prominent jewellers, aim to make gold purchases more accessible and affordable for individuals. Despite the challenges of holding large quantities of gold due to its substantial pricing, these schemes provide an avenue for regular investments with the ultimate goal of acquiring gold.
What is a Gold Savings Scheme?
A gold savings scheme functions similarly to a recurring bank deposit, with the key difference being that the accumulated funds are used to purchase gold. Individuals deposit a fixed sum monthly over a specific tenure, and at the scheme's maturity, they can buy gold from the jeweller equivalent to the total deposits made.
Unlike traditional recurring deposit plans, gold savings schemes do not offer interest on deposits. Instead, jewellers compensate by providing bonuses or discounts on the final instalment.
For instance, Mukesh's investment involves a monthly deposit of Rs. 6,000 for ten months, with a 90% discount on the last installment. Effectively, he pays Rs. 60,600 but enjoys a discount of Rs. 5,400, allowing him to purchase gold worth Rs. 66,000 at the end of the tenure.
Top Gold Investment Schemes in India
Several reputable jewellers offer gold savings schemes with unique features. Let's delve into a few prominent ones:
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Jos Alukkas’ Easy Buy Gold Purchase Plan
- Online Convenience: This scheme is available online, allowing subscribers to enroll and make installments through digital channels.
- Instalment Range: Monthly installments range from Rs. 1,000 to Rs. 1 lakh.
- Scheme Promotion Discount: Subscribers receive a promotion discount, typically applied to the last installment.
- Example: Geeta invests Rs. 5,000 monthly for 12 months, resulting in a total deposit of Rs. 60,000. With a 90% promotion discount on one installment, she can purchase gold worth Rs. 64,500.
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Tanishq Golden Harvest Scheme
- Flexible Investment: Individuals can start with as low as Rs. 2,000 per month.
- Maturity Benefits: A discount equivalent to 75% of one month’s installment is added upon maturity. Early withdrawal after 300 days attracts a discount of 55-75%.
- Redemption Benefits: Redemption value can be combined with ongoing Tanishq offers for added benefits.
- Example: Rajesh invests Rs. 4,000 monthly for 10 months, withdraws on the 301st day, and receives a 55% discount, resulting in a total redemption value of Rs. 42,200.
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Malabar Gold and Diamonds Smart Buy Plan
- Unique Features: Allows purchase of both “in stock” and “out of stock” jewellery at discounted rates.
- Additional Benefits: Offers free lifetime maintenance, one-year free insurance, and a gold buyback guarantee.
- Payment Terms: Requires upfront payment for the Smart Buy option, available for pieces not requiring resizing.
- Gold Quality: Provides BIS Hallmarked 916 Gold.
Gold Schemes by Banks
Gold schemes introduced in the 2015 budget aim to encourage saving idle gold in banks. Narendra Modi's government unveiled three schemes: the Gold Monetisation Scheme, the Sovereign Gold Bond Scheme, and the Gold Coin and Bullion Scheme.
Features of Bank Gold Schemes
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Depositor Approval- Depositors must obtain approval for the gold they wish to deposit from authorized collecting locations.
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Gold Verification- The purity of the deposited gold is verified at collecting locations before approval.
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Refining Process- Deposited gold is sent to refineries for melting, with the customer's permission.
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Certificate Issuance- Collecting facilities issue a certificate for the deposited gold, forming the basis for a Gold Savings Account.
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Storage- Refineries store the gold at a pre-agreed price with the bank, and customers incur no additional fees for this service.
Gold savings schemes in India offer diverse options for individuals to invest in gold, ranging from jeweller-specific plans to government-backed bank schemes. Each scheme has its unique features, advantages, and eligibility criteria, catering to a broad spectrum of investors. However, individuals must carefully assess their financial situation and investment goals before venturing into gold savings schemes, as they often require significant commitments.
