Not A Very Bright Idea
The proposed gold monetisation scheme to bring the idle gold lying in Indian homes to the banking system may prove to be a costly affair for banks. In the past, the Gold Deposit and Gold Metal Loan schemes have not been popular because of the low interest rates offered on those schemes. The proposed scheme will allow banks to sell the deposited gold to generate forex. However, the cost of refining the gold along with payment of interest on the deposits may prove costly for banks.
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