Jewellers incentivise customers who sell old gold to increase flow of yellow metal.

KOLKATA: Starved of steady gold supplies due to a slew of government restrictions, jewellers have decided to incentivise customers who sell old gold to increase the flow of recycled gold in the market. The trade is expecting that the move can unlock 200 tonne of household gold as compared to 80 tonne in the previous years.

Leading jewellers like Gitanjali, TBZ and Rajesh Exports are running schemes to bring household gold back into the market to ensure smooth supply of the metal at a time when Reserve Bank of India is tightening gold imports. According to industry estimates, nearly 20,000 tonne of gold is lying idle in Indian households.

Haresh Soni, chairman, All India Gem and Jewellery Trade Federation, said, "I have asked all our member jewellers to come up with incentive schemes so that people can change their old gold with new ones. This is a win-win situation for both the jeweller and the customer. While the jeweller is not required to look around for gold, the customer gets new hallmarked gold with 100% purity. If jewellers can effectively implement this, we will be able to unlock 200 tonne."

The Gitanjali group has just launched a new scheme to attract household gold to their retail stores. Santosh Srivastava, managing director, Gitanjali Jewels, said, "We are asking customers to come to our stores with their old gold. We will be melting and assaying the gold in front of them and we will not charge any extra for doing this. We will be giving a 100% credit to the customer for the gold present in a particular item. For any Gitanjali old jewellery, we will give an extra 3% exchange bonus. We are hoping that at least 15% -20% of gold sold through our stores will return through this route."

Tribhovandas Bhimji Zaveri (TBZ) has already organised an incentive event, said Kiran Dixit, head (marketing) of the jewellery firm. The jeweller has set up special old gold counters at its stores. "We did the last 'incentive mela' in March. June and July are a slack season for gold trade so we do not have immediate plans. We will kick off the campaign as and when required," said Dixit.

Source : economictimes.indiatimes.com