Gold Monetization Scheme (GMS) 2015 – Amendment
The Government of India, through its press release ID 2115009 dated March 25, 2025, has announced the discontinuation of the Medium Term and Long Term Government Deposit (MLTGD) components of the Gold Monetization Scheme (GMS), effective March 26, 2025. Consequently, no gold deposits under MLTGD will be accepted at Collection and Purity Testing Centres (CPTC), GMS Mobilisation, Collection & Testing Agents (GMCTA), or designated bank branches after March 25, 2025. However, designated banks may continue to offer Short Term Bank Deposits (STBD) at their discretion. Deposits under MLTGD mobilized up to March 25, 2025, will remain valid until maturity as per existing guidelines.
In line with this decision, the Reserve Bank of India (RBI), under the powers conferred by Section 35A of the Banking Regulation Act, 1949, has amended the Master Direction No. DBR.IBD.No.45/23.67.003/2015-16 dated October 22, 2015, reflecting the changes in the GMS. The updated Master Direction, along with revised Frequently Asked Questions (FAQs), is enclosed in the Annex to this circular.
Key Amendments:
Cessation of MLTGD Mobilization: With effect from March 26, 2025, MLTGD, including renewals, is discontinued. However, MLTGD mobilized until March 25, 2025, will continue as per existing terms.
Handling Charges & Commission: The Central Government’s provision for handling charges and commission at fixed rates for MLTGD applies only to deposits accepted before March 26, 2025.
Gold Deposit Accounts: The opening and maintenance of gold deposit accounts remain unchanged. However, MLTGD will no longer be credited post-March 25, 2025.
Redemption of MLTGD: Banks must notify depositors about redemption options at least 120 days before maturity. Depositors will be required to present the original deposit certificate for redemption. If no preference is indicated, the redemption will be in INR.
Gold Stock Maintenance: Banks must maintain gold stock equivalent to redemptions due within three months. Any shortfall must be reported to the Government of India through the RBI at least three months in advance.
The amended provisions take effect from March 26, 2025, and apply to all Scheduled Commercial Banks (excluding Regional Rural Banks). The RBI has updated its Master Direction to reflect these changes, ensuring a seamless transition following the discontinuation of MLTGD.
