April 26, 2023

Best Gold Savings Schemes in India 2023 by Banks & Jewellery

Gold is one of the most preferred investment vehicles for investors in the country. This is due to reasons such as high liquidity and the ability to withstand economic upheavals such as inflation. However, it can be difficult for most individuals to possess large amount of gold at once. This is why gold savings scheme can be beneficial.
These gold schemes are usually offered by various banks and jewellers.

What Is a Gold Savings Scheme?

A gold savings scheme works in a simple manner. You deposit a certain amount of money at regular intervals to a jeweller. At the end of tenure, you get to buy an amount of gold that is equal to the money accumulated in that period.
However, you won’t get any interest on this accumulated amount. To make up for this, the jewellers offer some discount such as the waiving off the last instalment. They might also pay off the last instalment as a bonus or cash incentive.
Let’s understand this with the help of the following illustration:
Suppose Mrs. Verma makes a monthly deposit of ₹5000 towards a gold savings scheme. The scheme has a tenure of 12 months. As per the bank’s policy, it will give a 100% discount on the last instalment.
So, the total amount Mrs. Verma has to pay will be, (5000X11)= ₹55,000.
However, the bank will pay the last instalment, making the total investment worth ₹ 60,000. Now she can purchase gold worth ₹60,000 from the jeweller while she actually deposited ₹55,000.

Gold Schemes Offered by Banks

The Indian Government launched three gold deposit schemes in the Union Budget of 2015. This was aimed at increasing deposit of gold that is lying idle. You can deposit unused gold to banks and they will offer an interest to you.
With these schemes, you can deposit and invest in gold easily. The three gold schemes include SGB or Sovereign Gold Bond, Gold Monetisation Scheme and Gold Coin and Bullion Scheme.

What Are the Features & Benefits of Gold Schemes?

Following are the features and benefits of a gold savings scheme:
  • The deposit period can be 3, 4, or 5 years
  • You can start investing with a minimum of 500gm. There is no cap on the upper limit.
  • You can deposit gold in any form such as gold bar, coins or jewellery.
  • You will receive a Gold Deposit Certificate from the Nodal Branch after the Indian Government melt, assay and mint it.
  • One individual can possess a maximum of 5 such certificates issued.
  • You will receive the Gold Deposit Certificate within 90 days from the deposit.
  • Depositors have the nomination facility available in single names.
  • If you want to transfer your scheme, it can be done by endorsement or delivery. You need to notify the Nodal Branch about this transfer.
  • You can either take repayment of the principal amount or equivalent gold as applicable on the day of maturity.
  • Premature withdrawal is applicable after the lock-in period of 1 year. However, a penalty will be applicable.
  • You can renew the scheme after its maturity.
  • You can avail loan facility of 75% of the notional value of gold at any SBI branch.
  • There are tax benefits available under Income Tax, Capital Gains Tax and Wealth Tax for this scheme.

What Are the Eligibility Criteria for Gold Savings Scheme?

In order to be eligible for gold savings scheme, you have to satisfy the following criteria:
  • You have to be a resident of India
  • You need to belong to a HUF (Hindu Undivided Family)
  • Any trust, company or individual can opt for this scheme.

What Are Some of the Top Gold Savings Schemes in India?

Here are some of the top gold savings schemes in India you can consider choosing from for investing:

Tanishq Golden Harvest Scheme

Under the Tanishq Golden Harvest Scheme, you can invest money for a period of 6 to 10 months. After maturity, you can use this amount to purchase gold jewellery of the same amount with a discount of up to 75%.

Kalyan Jewellers Gold Schemes

You can start investing in Kalyan Jewellers Gold Schemes with a minimum amount of ₹500, which can go up to ₹40,000. This instalment amount depends on the jewellery chosen at the beginning of the scheme. Deposit tenure is of 12 months and you can close the scheme by purchasing the jewellery selected. You can also invest in behalf of minors.

Malabar Gold & Diamonds Smart Buy Scheme

Malabar Gold & Diamonds Smart Buy Scheme allows depositors to save money while purchasing jewellery at a discounted rate. You can choose from the products which are available as well as from out-of-stock products. For out-of-stock orders, you need to place orders for a pre-decided date. You can also place orders for customised products with Smart Buy + Customize Option. Moreover, you can opt for 14 days return policy for available and ready to deliver products.

ICICI Gold Monetization Scheme

Under this scheme, you can earn interest on gold you have deposited to bank. The minimum deposit tenure can be of 3 years, which can be extended up to 15 years. The minimum gold deposit limit is 30gm. You need to be above 18 years of age to invest in this scheme.

SBI Gold Coins

Investors can purchase SBI Gold Coins at any SBI branch. Denominations are available from 2 to 50 grams. Any individual or organisation can invest in SBI Gold Coins Scheme.

RBI Sovereign Gold Bond Scheme 2018

This RBI Scheme enables any individual or organisation to invest in gold in multiples of 1 gram. However, the maximum limit of investment for HUFs is 4kg and for organisations, it is 20kgs. You can invest for a maximum period of 8 years with a lock-in period of 5 years. The applicable interest rate is 2.5% per annum.

Final Word

Gold savings schemes are like recurring deposits but in gold. These schemes are aimed at mobilising idle gold present in the country and reducing dependency on foreign gold imports.

Never miss a trading opportunity with Margin Trading Facility

Enjoy 2X leverage on over 900+ stocks

Upstox Margin Trading Facility
Apple Logo
Downloadlogo
iOS App
Google Play Logo
Downloadlogo
Android App

RELATED ARTICLES

NPS Tier 2 - Returns, Withdrawal, Tax Benefit, & How to Open

The Pension Fund Regulatory and Development Authority oversees the central government retirement program known as NPS, or [National Pension System](https://upstox.com/saving-schemes/nps-national-pension-scheme-india/) (PFRDA). It is a program to inspire Indian individuals to save money regularly. Additionally, it provides both tax savings and pension benefits. NPS interest rates are variable. The efficiency of the underlying securities affects the NPS Tier 2 returns. NPS offers two different account types: NPS Tier 1 accounts and NPS Tier 2 accounts. The NPS Tier 2 account is thoroughly covered in this article.

EPF Balance India & How to Check it Online via Mobile Number & SMS

It is no secret that the Employee Provident Fund, or EPF, plays an extremely important role in an employee's financial life. It acts like an effective retirement fund supported by equal monthly contributions from the employee and the company. To keep track of the long-term contributions from both parties, a digital [EPF member passbook](https://upstox.com/saving-schemes/epfo-passbook-download/) is usually made available to every employee who is an EPFO member, wherein the EPF balance placed into the account is shown. Employee Provident Fund (EPF) contributions generally comprise 12% of an employee's gross income plus a matching amount from the employer. While taxes are not applied to the employer's EPF contribution, the employee can benefit from a tax deduction for contributions made to the EPF under Section 80C of the Income Tax Act. In other words, from an employee's perspective, payments to the EPF, interest that accrues on the PF balance, and withdrawals of money after the requisite specified duration (5 years) are all completely tax-free. When the employees retire, they get a tax-free lump payment from the Employee Provident Fund, which, as expected, includes the full contribution from both the company and the employee (EPFO), wherein the organisation determines the fixed annual interest rate. When calculating the interest accrued to the EPF account, the account's balance comes into play. While the annual percentage rate used to compute interest is 8.75%, every year on April 1st, the interest is computed on the total amount in the EPF account. All employees must be aware that although EPF withdrawals occur regularly, interest is determined annually. Therefore, it becomes much more important to regularly conduct your PF Balance check, especially at the start of the year.

Kisan Vikas Patra (KVP) 2023: Scheme & Benefits

Before you invest in any savings plan, you should try to know it in and out. The Kisan Vikas Patra is a savings scheme managed directly by the Government of India. The scheme's primary objective is to help individuals accumulate wealth over time. Also, the Kisan Vikas Patra scheme wants individuals to inculcate a habit of saving money. The Kisan Vikas Patra Scheme is a post office scheme launched in 1988. The scheme wanted people to understand the importance of long-term savings and inculcate a financial discipline. Earlier, the scope of the KVP Scheme was only limited to farmers. However, the scope has broadened, and anyone who meets the eligibility criteria can invest in the Kisan Vikas Patra. Vikas Patra has a tenure of 124 months, meaning your money will remain invested in the savings scheme for about ten years. You need to apply for a certificate by reaching out to a post office or a few public sector banks chosen by the Government of India. This guide will help you understand everything you need to know before investing in the Kisan Vikas Patra Scheme.

NPS Vs PPF - Which is Better & Difference

Retirement can be the best or worst time of your life, depending on how well-prepared you are for it. On the one hand, you will have enough time on your hands to do whatever you want to do, without having to worry about work. On the other hand, you no longer have a regular income from work, which may mean not having the necessary money to meet all of your requirements. Add to that inflation and increasing life expectancy, which can continue for a long time. This is why retirement planning is so important. Unless you are eligible for a pension when you stop working (and sometimes even if you are), you will have to invest in retirement schemes to live out your golden years comfortably without stress. That’s why the government of India has made retirement savings possible through specific schemes they offer. The two most essential schemes among these are the [Public Provident Fund](https://upstox.com/saving-schemes/public-provident-fund-ppf-interest-rate/) or PPF and the National Pension Scheme or NPS. Moreover, these schemes come with tax benefits that make them more attractive to citizens. They are covered under Section 80C of the Income Tax Act, meaning you can claim a tax benefit of up to INR 1.5 lakhs by investing in either product. However, that’s where the similarity ends. They are very different in terms of tenure, returns, lock-in periods, and maturity amount usage. This article will explain the features of both these schemes and their similarities and differences in more detail.