RBI

Gold Metal Loans-Banks to provide option to borrower to repay part of GML in physical gold

Gold Metal Loans-Banks to provide option to borrower to repay part of GML in physical gold in lots of one kg or more

AS per RBI directions nominated banks are authorized to import gold and designated banks participating in Gold Monetization Scheme, 2015 (GMS) can extend Gold (Metal) Loans (GML) to jewellery exporters or domestic manufacturers of gold jewellery.

These loans are repaid in INR, equivalent to the value of gold borrowed, on the relevant date/s.

In modification of the existing conditions, it has been provided that Banks shall provide an option to the borrower to repay a part of the GML in physical gold in lots of one kg or more subject to:
a. the GML has been extended out of locally sourced / GMS-linked gold;
 
b. repayment is made using locally sourced IGDS (India Good Delivery Standard)/ LGDS (LBMA’s Good Delivery Standards) gold;
 
c. gold is delivered on behalf of the borrower to the bank directly by the refiner or a central agency, acceptable to the bank, without the borrower’s involvement;
 
d. the loan agreement contains details of the option to be exercised by the borrower, acceptable standards and manner of delivery of gold for repayment;
 
e. the borrower is apprised upfront, in a transparent manner, of the implications of exercising the option.
 
Further, Banks shall suitably incorporate the above aspects into the board-approved policy governing GML along with concomitant risk management measures and Banks shall continue to monitor the end-use of funds lent under GML.
 
----------- Similar Posts: -----------
Share
Leave a Comment

Recent Posts

  • Income Tax

CBDT extends cut off date for investment by Sovereign Wealth Funds/Pension Funds

CBDT extends cut off date for investment by Twelve sovereign wealth funds / Pension Funds from 31st March 2024 to…

3 hours ago
  • Income Tax

HC dismissed appeal against inadequacy of sentence in income tax prosecution cases

Appeal against inadequacy of sentence passed by special court in income tax prosecution cases dismissed by High Court  In a…

1 day ago
  • ICSI

ICSI launches CS Mitr Scheme to give incentive for student registrations

ICSI launches CS Mitr Scheme to give incentive for getting student registered in Executive Programme ICSI has launched CS Mitr…

1 day ago
  • Income Tax

CPC order u/s 143(1) is appealable and hence no merger with order u/s 143(3) – ITAT

CPC order u/s 143(1) is appealable and hence the doctrine of merger with order u/s 143(3) do not arise -…

2 days ago
  • GST

Under GST Act, there is no specific provision to disclose route of transportation of goods

Under GST Act, there is no specific provision which bounds selling dealer to disclose route to be taken during transportation…

2 days ago
  • Companies Act

Restrictions on use of words “Nidhi Limited”-The Nidhi (Amendment) Rules, 2024

Restrictions on use of words Nidhi Limited unless declared as such under section 406(1). Nidhi (Amendment) Rules 2024 MINISTRY OF…

2 days ago