India on Friday tweaked its gold monetisation scheme to allow repayments in gold for medium- and long-term deposits, making the plan more attractive for temples that are sitting on thousands of tonnes of the metal.
The Sri Venkateswara Swamy Temple or Tirupati, the world’s richest Hindu temple whose participation is crucial to the success of mobilising India’s idle gold, had requested repayment of deposits held for more than three years in the yellow metal.
The government will charge a fee of 0.2% on the value of gold redemptions but the interest will be paid in cash, the country’s central bank said in a statement.
Depositors will still have the option of redeeming deposits in cash.
Prime Minister Narendra Modi last year launched the Gold Monetisation Scheme to mobilise gold stashed with individuals, institutions and rich temples for recycling and to reduce imports. The scheme has garnered about three tonnes of gold in four months out of a national hoard of over 20,000 tonnes.