Gold sitting unused in home lockers may soon start earning returns—just like a bank deposit.
The government is working on a revamped version of the Gold Monetisation Scheme to make this possible.
Experts like Subhash Chandra Garg believe earlier versions were costly and poorly designed, while industry voices say the new plan must be simpler and more attractive for people.
Turn Idle Gold into Income
The idea is simple. Instead of keeping gold locked away, you can deposit it with a bank and earn interest on it.
Under the scheme:
You can deposit coins, bars, or jewellery
You earn around 2–2.5% annual interest
It works similar to a fixed deposit
At maturity, you can take back gold value or cash
This means your unused gold can finally start generating income instead of just sitting idle.
Why This Matters for India
Indian households are estimated to hold over 20,000 tonnes of gold.
That’s a massive amount of wealth lying unused.
At the same time, India imports large quantities of gold every year, which increases:
Import bills
Dollar outflow
Pressure on the rupee
If even a small portion of this idle gold enters the system, it could reduce imports and support the economy.
What Will Change This Time?
The earlier Gold Monetisation Scheme didn’t see much success.
Now, the government is trying to fix those issues.
The revamped version may include:
Better returns to attract users
Simpler deposit process
More flexibility in how gold is deposited
Clearer tax rules
The goal is to make the scheme easier and more appealing for everyday users.
A New Approach Led by Jewellers
The All India Gems and Jewellery Domestic Council (GJC) has also proposed a new model.
Instead of focusing only on physical deposits, the idea is to create a digital system where gold is tracked and managed electronically.
This system would:
Allow end-to-end digital tracking
Improve transparency
Ensure proper verification and security
Help users earn returns without selling gold
It could make the entire process smoother and more trustworthy.
Changing Trend: More Coins and Bars
There is already a shift in how people buy gold.
In 2025, around 280 tonnes of gold was bought mainly as coins and bars, not jewellery.
This is important because coins and bars are easier to deposit.
Unlike jewellery, they don’t carry emotional value, making people more willing to use such schemes.
Why the Old Scheme Failed
The earlier scheme struggled for a few key reasons:
Jewellery had to be melted, which many families didn’t like
Emotional attachment to gold was a big barrier
Returns were not attractive enough
Awareness was low
Because of this, only about 38 tonnes of gold was mobilised by 2025—a very small amount compared to total holdings.
Challenges Still Remain
Even with improvements, some concerns are still there:
People may hesitate to deposit jewellery
Purity testing can be complicated
Tax-related worries, especially for inherited gold
Unless these issues are addressed, participation may remain limited.
What’s in It for You?
For individuals, the benefits are quite clear:
Earn income from idle gold
Reduce risks of storing gold at home
Enjoy a structure similar to fixed deposits
However, one important point to remember: if you deposit jewellery, it will be melted, and you won’t get the same pieces back.
Overall, the revamped Gold Monetisation Scheme could be a big step toward turning idle gold into a productive asset—both for individuals and the economy.
