Delhi: The RBI on Wednesday asked banks to provide an option to jewellery exporters and domestic manufacturers of gold jewellery to repay a part of Gold (Metal) Loans (GML) in physical gold. As per the extant instructions, banks authorised to import gold and designated banks participating in Gold Monetisation Scheme, 2015 (GMS) can extend GML to jewellery exporters or domestic manufacturers of gold jewellery.
As per an RBI circular, "banks shall provide an option to the borrower to repay a part of the GML in physical gold in lots of one kg or more," subject to certain conditions. One of the conditions is that the GML has been extended out of locally sourced or GMS-linked gold.
Also, the repayment had to be made using locally sourced IGDS (India Good Delivery Standard)/ LGDS (LBMA's Good Delivery Standards) gold; and the yellow metal has to be delivered on behalf of the borrower to the bank directly by the refiner or a central agency without the borrower's involvement.
