The World Gold Council (WGC) released a report on Thursday that highlighted that imports made up roughly 86 per cent of the country’s gold supply between 2016-2020. Meanwhile, recycling accounted for 13 per cent and mining accounted for just one per cent of the gold supply.
Sudheesh Nambiath, Associate Vice President, India Gold Policy Centre, is of the view that 80 per cent of the gold in our country is hardly used and can be zipped and stored in bank locker, which can then be used to draw loans against.
“Trust which people have on a fintech product in India has grown phenomenally in recent years supported by strong regulatory framework already in place. Gold lending fintech startups will be key for driving the gold monetization”, says Sudheesh.
And this is where digital lending startup platforms such as Rupeek and Indiagold can play a crucial role in that direction, the WGC observes.
“Asset-backed, digital lending platforms such as Rupeek and others are the starting point of changing the mindset from holding the entire precious metal to some part of it in a transparent institutional setup”, said Somasundaram PR, Regional CEO, India, World Gold Council, while speaking to DH.
Gem & Jewellery Export Promotion Council (GJEPC) says that India can save up to 500 tonnes or about 40 per cent of total gold imports annually if it can monetize its idle gold through digital lending platforms.
“Emotional orientation of people needs to be changed and we are working with all stakeholders. Our customers’ gold is stored in branches of some of the leading banks with which we have signed pacts with the likes of ICICI Bank, Karnataka Bank, South Indian Bank and a couple of other NBFSs”, says Sumit Maniyar, Founder and Chief Executive Officer, Rupeek.
Sudheesh says that creating a system whereby gold
can be stored in a bank and taking a loan against it at any given point of time without the need to be physically present can monetize the idle gold in India.
Incentives have to be given for digital gold buying in order to solve the problems that exist like low value addition, asset value not coming back to circulation and the sector being cash dominated, Somasundaram said.
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