TaxTMI 
TaxTMI 
Bank finance for purchase of gold
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....ank finance for purchase of gold <br>News and Press Release<br>Dated:- 7-12-2012<br><BR>RBI/2012-13/317 RPCD.CO.BC. 50/03.05.33/2012-13 December 05, 2012 All Regional Rural Banks Dear Sir/Madam Please refer to paragraphs 102 and 103 (extract enclosed) of the Second Quarter Review of Monetary Policy 2012-13 announced on October 30, 2012, proposing that other than working capital finance, banks....
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.... are not permitted to finance purchase of gold in any form. 2. In terms of extant guidelines, no advances should be granted by banks against gold bullion to dealers/traders in gold if, in their assessment, such advances are likely to be utilised for purposes of financing gold purchase at auctions and/or speculative holding of stocks and bullion. In this context, the significant rise in imports of....
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.... gold in recent years is a cause for concern as direct bank financing for purchase of gold in any form viz., bullion/primary gold/jewellery/gold coin etc. could lead to fuelling of demand for gold. Accordingly, it is advised that no advances should be granted by RRBs for purchase of gold in any form, including primary gold, gold bullion, gold jewellery, gold coins, units of gold Exchange Traded Fu....
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....nds (ETF) and units of gold Mutual Funds. However, RRBs can provide finance for genuine working capital requirements of jewellers. Yours faithfully, (C.D. Srinivasan) Chief General Manager Encl: As above Extract of Second Quarter Review of Monetary Policy 2012-13 Bank Finance for the Purchase of Gold and Advances against Gold 102. In terms of extant guidelines, no advances should be gran....
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....ted by banks against gold bullion to dealers/traders in gold if, in their assessment, such advances are likely to be utilised for purposes of financing gold purchase at auctions and/or speculative holding of stocks and bullion. In this context, the significant rise in imports of gold in recent years is a cause for concern as direct bank financing for purchase of gold in any form viz., bullion/prim....
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....ary gold/jewellery/gold coin could lead to fuelling of demand for gold for speculative purposes. The Monetary Policy Statement of April 2012 announced the constitution of a Working Group (Convenor: Shri K.U.B. Rao) to study issues relating to gold imports and gold loans by Non-Banking Financial Companies (NBFCs) in India. The Working Group submitted its draft report in August 2012. Pending a decis....
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....ion on its recommendations, it is proposed to advise banks that: Other than working capital finance, banks are not permitted to finance purchase of gold in any form. 103. Detailed guidelines in this regard are being issued separately.<BR> News - Press release - PIB....