All India Gem and Jewellery Domestic Council (GJC) has been actively engaging with senior officials of the Reserve Bank of India (RBI) and the Ministry of Finance (MoF) to advance a comprehensive revamp of the Gold Monetisation Scheme (GMS).

GJC has submitted a refined, jeweller-integrated framework for GMS, developed through structured stakeholder consultations across the banking, refining, and jewellery sectors. The proposed model is designed to address existing structural inefficiencies and significantly enhance the scheme’s adoption and effectiveness.

Regulatory Alignment and Digital Framework
The proposed GMS operates within the existing regulatory framework notified by the RBI and the Government of India, ensuring full compliance, institutional oversight, and financial system integrity. The framework builds on the current scheme architecture while introducing operational efficiencies and stakeholder alignment.

A central feature of the proposal is the formal transition towards a digital gold ecosystem, whereby physical gold is converted into dematerialised gold balances held within the banking system through structured account mechanisms.

Leveraging Growth in Bullion and Coin Investment

In recent years, investment demand in gold bullion and coins has witnessed strong and sustained growth, reflecting increasing investor preference for physical gold as a store of value. The revamped GMS framework seeks to effectively leverage this trend by enabling investors to seamlessly monetise such holdings.

The scheme provides an avenue for investors to earn a return on idle gold assets, including bullion, coins, and jewellery, by integrating them into the formal financial system. This converts traditionally non-yielding assets into interest-bearing financial instruments, thereby enhancing portfolio efficiency without requiring liquidation of gold holdings.

Transparency, Traceability and Accountability
The revised framework is anchored on robust governance principles:

• Transparency: End-to-end digital recording of transactions, including deposit, assay, dematerialisation, and credit.
• Traceability: System-based tracking of gold across the value chain, supported by verifiable documentation and audit trails.
• Accountability: Clearly defined responsibilities for all participants, reinforced through KYC compliance, documented consent, and regulatory supervision.

This structure ensures a secure, compliant, and auditable gold monetisation ecosystem, addressing key concerns under the existing scheme.

Economic Significance
The proposed framework is expected to materially improve gold mobilisation by leveraging the reach and trust of the jewellery trade. Enhanced mobilisation of idle gold can reduce dependence on imports, support domestic supply, and contribute to moderation of the Current Account Deficit (CAD).
Further, the shift towards a regulated digital gold framework will strengthen formalisation, improve compliance standards, and enhance overall market efficiency.

Mr. Rajesh Rokde, Chairman GJC, said, “GJC’s continued engagement with the Reserve Bank of India and the Ministry of Finance reflects our commitment to building a robust and future-ready Gold Monetisation framework. The proposed model integrates jewellers into a regulated, digital ecosystem, significantly enhancing transparency, trust, and accessibility for consumers. By unlocking the value of idle gold, the scheme has the potential to strengthen domestic supply, reduce reliance on imports, and contribute meaningfully to India’s macroeconomic stability."

Mr. Avinash Gupta, Vice Chairman GJC, said “The revamped GMS framework is designed to be practical, scalable, and fully aligned with regulatory expectations. It creates a secure and transparent pathway for gold monetisation, while ensuring accountability across all stakeholders. Importantly, it enables investors to earn returns on idle gold—including bullion, coins, and jewellery—thereby transforming a traditionally non-yielding asset into a productive financial instrument. This will play a critical role in formalising the sector and improving overall market efficiency."

Conclusion
GJC believes that the proposed model provides a practical, scalable, and regulator-aligned solution to revitalise GMS. The Council will continue its engagement with the RBI and the Ministry of Finance to facilitate implementation.

The trade is encouraged to support this initiative, which represents a significant step towards a regulated, transparent, and digitally integrated gold ecosystem in India, while unlocking value from idle gold holdings.

Courtesy : AOJ Desk News