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SBI's Gold Deposit Scheme: How It Works, Interest Rates, Other Details

Customers need to deposit a minimum of 30 grams (gross) of gold to avail the scheme. However, there is no upper limit for deposit, said SBI.

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SBI's Gold Deposit Scheme: How It Works, Interest Rates, Other Details

Gold is accepted in the form of raw gold such as gold bars, coins and jewellery, said SBI.


SBI or State Bank of India, the country's largest lender, offers Revamped Gold Deposit Scheme (R-GDS), which is a fixed deposit scheme in gold. A fixed deposit is a financial instrument provided by banks, which provides investors a higher rate of interest than a regular savings account, until the given maturity date, according to the bank. Under R-GDS, customers can deposit their idle gold which will provide them safety and interest earnings, said SBI on its official website- sbi.co.in.  

Here are 10 things to know about SBI's Revamped Gold Deposit Scheme (R-GDS):

1. Resident Indians of categories such as individuals, proprietorship and partnership firms, HUFs (Hindu Undivided Family), mutual funds/exchange traded funds registered under Sebi (Securities and Exchange Board of India) and companies are eligible to invest in SBI's Revamped Gold Deposit Scheme.

2. Customers need to deposit a minimum of 30 grams (gross) of gold to avail the scheme. However, there is no upper limit for deposit, said SBI. 

3. There are three types of deposits under SBI's R-GDS:  

Short term bank deposit (STBD): Tenure for STBD ranges from a minimum of 1 to a maximum of 3 years. 

Medium Term Government Deposit (MTGD): Tenure for MTGD is between 5-7 years. The deposit will be accepted by the bank on behalf of the central government.

Long Term Government Deposit (LTGD): Tenure for LTGD is between 12-15 years. The deposit will be accepted by the bank on behalf of the central government.

4. Gold is accepted in the form of raw gold such as gold bars, coins, jewellery excluding stones and other metals.

5. The interest rates under STBD are, 0.50 per cent per annum (p.a.) for 1 year, 0.55 per cent for up to 2 years and 0.60 per cent for 3 years. The interest rates under MTGD for 5-7 years are, 2.25 per cent p.a. The interest rates under LTGD for 12-15 years are, 2.50 per cent p.a.

6. In the case of MTGD & LTGD, the principal is denominated in gold. However, the interest need to be paid in rupees annually on March 31 or cumulative interest on maturity, said the bank.  

7. Interest on deposits under the scheme starts accruing from the date of conversion of gold deposited into tradable gold bars after refinement or 30 days after the receipt of gold whichever is earlier, according to SBI.

8.  Under SBI's R-GDS, nomination facility is available for deposits in single names in individual capacity.

9. Under STBD, investor has the option of taking a repayment of principal, either in gold or equivalent rupees as on the date of maturity. Under MTGD and LTGD, redemption of the deposit will be in gold or rupees equivalent of the value of gold as per then prevailing price of gold. However, 0.20 per cent administrative charges will be levied in case of redemption in gold.

10. Under STBD, premature payment is allowed after a lock-in period of 1 year with a penalty on applicable interest rate. However, a Medium Term Government Deposit can be withdrawn only after 3 years and a Long Term Government Deposit can be withdrawn after 5 years. 



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