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SBI's Revamped Gold Deposit Scheme (R- GDS): All You Need To Know

Roshni Agarwal

Gold in physical form that is lying idle cannot increase your wealth but the Revamped Gold Deposit Scheme (R- GDS) of SBI helps you earn interest on physical gold investments. Financial advisors suggest that an individual's overall portfolio should comprise 10-15% in gold investments. So, you can consider investment in this scheme by SBI which is a type of fixed deposit in gold. Herein investors can deposit their idle gold under R-GDS and earn interest plus their physical gold will be secure at the bank.

Here is a breakdown on the investment option:

Eligibility: Resident Indians who may be individuals, singly or jointly (as former or survivor), proprietorship and partnership concern, HUFs, companies and trusts that include ETFs, mutual funds registered under SEBI (Mutual Fund) Regulations can invest in SBI R-GDS.

Customers applying for the scheme need to submit Application Form, proof of identification, address proof and inventory form.

Purpose: As per the bank's website, the idea behind revamped- Gold deposit scheme by SBI is to mobilize idle gold in the country and deploy it to productive use. Also, the scheme enables investors to earn interest on their idle gold holdings.

Minimum and maximum investment: In the scheme, investors need to invest a minimum of 30 gms gold (in gross). However there is no upper limit on the investment in SBI's R-GDS.

Raw gold either as gold coin, gold bar or jewellery is accepted by the bank under the R-GDS deposit scheme.

Deposit types under R-GDS: The country's leading lender SBI offers 3 types of deposit under the scheme depending upon the investment tenure

1. Short Term Bank Deposit (STBD): Tenure 1 to 3 years

2. Medium Term Government Deposit (MTGD): Tenure of the investment ranges between 5 and 7 years. The deposit will be accepted on behalf of the Central Government by the bank.

3. Long Term Government Deposit (LTGD): Tenure 12-15 years. This deposit too will be accepted by SBI on behalf of the central government.

Deposit type Interest rate
0.5% p.a. for one year term, 0.55% p.a. for over 1 year up to 2 years and 0.60% p.a. for above 2 years to 3 years
MTGD 2.25% p.a.
LTGD 2.50% p.a.

Interest pay-out: Investors in the scheme at the time of deposit need to choose interest payment mode i.e. simple interest paid annually or on a cumulative basis upon maturity. It is to be noted that interest on gold deposit will begin to accrue from the date when deposited gold gets converted into tradable gold bars post refinement or 30 days after the gold is received by the bank whichever is earlier.

Issuance of gold deposit certificate: Against the deposit, a certificate will be issued for pure gold content in 995 fineness. The depositor will receive the gold deposit certificate from the nodal branch i.e. Bullion branch based out of Mumbai.

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