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.
 
Share

Recent Posts

  • Income Tax

Assesee not deducting TDS due to stay by High Court can’t be treated as assessee in default

When assesee did not deduct TDS on account of interim stay of High Court, it can’t be regarded as assessee…

20 minutes ago
  • Income Tax

Penalty u/s 271B is not attracted where books of account not maintained – ITAT Allahabad

Penalty u/s 271B is not attracted in a case where books of account have not been maintained In a recent…

22 hours ago
  • Empanelment

NALCO invites RFP for empanelment of CA Firms for verification of Stores/Spares & movable assets

NALCO invites RFP for empanelment of Chartered Accountant Firms for verification of Stores/Spares and movable assets.  NALCO has invited Request…

24 hours ago
  • RBI

Sending or bringing currency of Nepal and Bhutan – RBI revises regulations

Sending or bringing currency of Nepal and Bhutan - RBI revises exiting regulations  RBI has notified the Foreign Exchange Management…

1 day ago
  • Excise/Custom

Manufacturing without aid of power. Entire process though by distinct units to be seen – SC

Entire manufacturing process though by distinct units relevant for exemption from excise duty on account of manufacture without aid of…

1 day ago
  • Income Tax

Delay in filing Form 10B condoned as failure was in 1st year of operation of Trust

High Court condoned delay in filing Form 10B as the failure was in the 1st Year of operation of the…

1 day ago