I just made an addendum to my report on Gold Finance Co. with latest available stats. Am uploading the same herewith. On the key monitorables, I have done some more research and my comments on the same
A. Govt’s Gold Monetisation scheme - It has not been very successful as govt has hardly put any efforts to popularize these schemes. 6.4 tons mobilized so far
- Onerous process of melting the jewelry, verifying the purity, obtaining the certificate from registered hallmark valuer and converting it into Gold Coins – not everyone would be willing to do that (certainly not the bottom of the pyramid customer – due to sentimental value). Moreover so because once you deposit the Gold - it is locked in for a period of 3 Years - hence these schemes are useful for those having excess gold. Hence not relevant for the bottom of the pyramid customer
- Very low int rates of 2% to 2.5%. These too were taxable, until recent budget which exempted the interest from taxation.
So net net - Gold monetisation will not have too much impact on Gold Loan Companies
Addendum to Gold Finance Co’s.pdf (226.7 KB)