Page 18 - Bullion World Volume 02 Issue 11 November 2022_Neat

Bullion World | Volume 2 | Issue 11 | November 2022

collateral amounting to a minimum of and 11%. Can you elaborate on these vii. What is the GST implication in the
105% of the leased metal value from please? entire lease transaction, if any?
the borrowers. GMS currently offers yield ranging The existing tax regulations
from 0.5% to 2.50% pa under the governing leasing products apply.
iv. How many jewellers are enrolled short (1-3 years), medium (5-7
in this scheme so far? What are the years) & long-term (12-15 years) viii. What is the role of SafeGold in
enrolment criteria for any jeweller? leases. To qualify for the highest this model? What is the fees you plan
All reputed Jewellers/Manufacturers bracket yield, the investor must lock to charge for the service?
who fulfil the KYC/AML checks, due in their gold for 12+ years. And who pays for the same, the digital
diligence and appraisal requirements Gold lease rates are largely gold owner or the jeweller?
of SafeGold are eligible to enrol governed by diverse factors SafeGold, as a digital gold platform
under the scheme. More than pertinent to the gold markets, provider, facilitates the leasing
100 jewellers have applied for the along with the much wider macro- of gold metal between its digital
scheme, and so far, 3-4 of them economic and geopolitical trends. customers and the jewellers in
have been listed on a pilot basis. Larger jewellers also get the benefit terms of onboarding parties, vetting
of leases at lower yields compared to jewellers listed for the lease options,
v. GMS offers 2.5% yield pa while MSME jewellers. managing the security provided,
gold metal loans of banks are offered and physically transferring the metal
at around 7 to 9% pa (in rupee terms From our product’s perspective, we between parties.
and at around 3% pa in dollar or metal expect yields in our scheme to stay
terms). What is the likely yield one within the range of 3-6% pa. This We ensure that this transfer takes
can expect in your scheme? In your is in addition to the 9-11% long- place from the customer’s account
website, you have mentioned 6% term annual returns from gold price to the jeweller through a traceable
appreciation, which can ultimately chain of custody via our vaulting
give the customer 12-15% returns partners.
overall on their gold savings if they
continue to lease their metal over the The yield payments are added to
From product’s long term. the digital customer’s account every
perspective, we expect month, and at the end of the lease
yields in our scheme to vi. In your assessment, what portion tenure, when the jeweller settles
stay within the range of your existing investors would the lease, SafeGold processes the
opt for the scheme in the first three
closure transaction and updates
of 3-6% pa. This is in years? the customer's digital gold balance.
addition to the 9-11% We have seen an excellent response SafeGold charges jewellers a service
long-term annual from customers in the pilot run thus fee of approximately 25 basis points.
returns from gold price far. Our leases (100 gm - 1 kg) Retail customers are not charged

appreciation, which typically sell out within 24 hours, and any fees at this point.
65.5% of customers return to lease
can ultimately give their gold more than once.
the customer 12-15%
returns overall on their Given the many benefits of opting to

gold savings if they lease out digital gold holdings, we
continue to lease their foresee a great opportunity for our
25+ million retail clients, especially
metal over the long once doorstep pick-up is also
term. launched.

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