EGRs & Their Impact
on The Indian Gold Market
EGRs are receipts for your gold deposits in SEBI-registered vaults, similar to a bank balance that shows the money the bank holds on your behalf.
The vault manager will hold the gold physically on your behalf, and each EGR will denominate 10g of gold.
EGRs Makes Selling Gold Easy
You can check the price and purity of the EGR in real time & sell when the price seems right.
Security of Your Gold
The vault manager has to maintain extensive security standards & take insurance to ensure the safety of your gold.
Security of Gold
In case of any discrepancy, the vault manager is responsible
for replenishing the gold of the same quality and quantity.
Quality of Gold
The vault manager verifies the purity of the gold before creating the EGR. This purity standard would avoid any quality
issues when selling.
Redeeming Physical Gold
EGRs should be ‘fungible’, enabling EGR holders to convert EGRs issued by one vault manager at another vault manager’s facility.
Trading Physical Gold Through EGRs
Gold ETFs are popular but not a tool for trading physical gold on exchange. EGRs are the first such product in India.
India Doesn’t Have Gold Price Discovery
Despite being one of the biggest importers of gold, there is no price discovery because gold prices are not uniform in India.
Effects of EGR Introduction
With EGRs, there would be costs that vault managers would charge investors.
Can India be a Price Maker After EGRs?
With the correct execution, EGRs can transform the Indian gold market.
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