Archive · 19 Aug 2026
Government Considers Jeweller-Led Scheme to Unlock Idle Gold
The government wants people to put unused gold with trusted jewellers instead of keeping it locked at home.
People who deposit their gold could receive interest.
The deposited gold might be recorded in a demat account, similar to shares.
Jewellery, gold coins and bars may all be included.
The government hopes this will reduce the need to import more gold.
Supporters believe family jewellers may make people more comfortable than banks.
The earlier bank-based scheme attracted only 38 tonnes by March 2025.
However, some experts worry that allowing coins and bars could make people buy more gold just to earn interest.
The final rules have not yet been announced.
The government is discussing a gold monetisation scheme in which jewellers would accept physical gold deposits and subscribers would earn interest.
Gold deposits could be recorded through demat accounts, with jewellery, coins and bars potentially eligible under the proposal.
The plan aims to mobilise household gold, reduce gold imports and ease pressure on India’s exchange rate and foreign-exchange position.
Jewellery leaders say using family jewellers could increase public participation compared with the 2015 bank-led scheme, which had mobilised 38 tonnes by March 2025.
Officials are still working on assaying standards, purity-dispute liabilities, tax documentation and jeweller incentives, while some analysts warn coins and bars could encourage additional gold purchases.
- Who
- The Government of India is discussing the proposal with major jewellers, industry bodies and market participants.
- What
- A proposed gold monetisation scheme would allow people to deposit physical gold with jewellers and receive interest on its value.
- When
- The scheme has not been formally announced; an industry source expects it by the month of publication or before the festival season in October, although an earlier expectation was August 15.
- Where
- Deposits would be made through participating jewellers, potentially at nearby family-jeweller outlets, with holdings reflected in demat accounts.
- Why
- The proposal aims to mobilise household gold, reduce gold imports and support India’s foreign-exchange position.
Supporters of the proposal
Skeptics and potential concerns
Role of jewellers
Supporters of the proposal
Rajesh Rokde and Prithviraj Kothari say family jewellers are more trusted and accessible than banks, which could remove barriers to participation.
Skeptics and potential concerns
The proposal still requires rules defining jewellers’ responsibilities, including how purity disputes and assaying will be handled.
Economic impact
Supporters of the proposal
Nilesh Shah argues that even partial mobilisation of household gold could add substantial domestic savings, support investment and improve the trade account.
Skeptics and potential concerns
The proposal is intended to curb imports, but its overall impact depends on how much gold is actually deposited and whether new purchases are encouraged.
Coins and bars
Supporters of the proposal
Including gold coins and bars could broaden participation beyond jewellery owners and increase the amount of gold eligible for deposits.
Skeptics and potential concerns
A bullion analyst warned that people could buy coins or bars specifically to deposit them for interest, potentially undermining the goal of reducing gold imports.
- Current status
- The government is in talks with jewellers, but the final proposal and rules have not been announced.
- Potential deposit points
- Jewellers would serve as collection partners instead of banks.
- Eligible gold
- Jewellery may qualify, and gold coins and bars are also being considered.
- Depositor return
- Subscribers would receive interest income based on the value of deposited gold.
- Earlier scheme
- The 2015 Gold Monetisation Scheme had mobilised 38 tonnes by March 2025, according to government data.
- Household holdings
- Experts estimate that Indian households hold significantly more than 20,000 tonnes of gold.
- Pending issues
- Assaying standards, purity disputes, tax documentation and incentives for jewellers are still being worked out.