{"id":5537,"date":"2014-07-17T03:18:40","date_gmt":"2014-07-17T03:18:40","guid":{"rendered":"http:\/\/www.apnaplan.com\/?p=5537"},"modified":"2014-07-16T07:20:17","modified_gmt":"2014-07-16T07:20:17","slug":"the-end-of-gold-saving-schemes","status":"publish","type":"post","link":"https:\/\/www.apnaplan.com\/the-end-of-gold-saving-schemes\/","title":{"rendered":"The End of Gold Saving Schemes"},"content":{"rendered":"
\"The
The End of Gold Saving Schemes<\/strong><\/figcaption><\/figure>\n

In 2011\/2012 a lot of Gold jewelry companies\/shops had launched Gold Saving Scheme<\/a>\u00a0\u2013 an innovative way to sell jewelry which had become unaffordable due to sharp increase in Gold Prices. The broad scheme structure was the customer needed to pay for 11 installments and the company paid the last installment. The entire money could then be used to buy jewelry from that shop. There were multiple versions of the same <\/a>with time period ranging from 1 to 5 years.<\/p>\n

The best part of such schemes was that the return was more than 15% as compared to 9% return of fixed deposits. But there was no customer protection<\/strong> as these schemes were not controlled by any regulators. Fortunately we did not hear of any fraud in these schemes, but had the Gold prices been volatile there were high chances of small shops not valuing their commitments.<\/p>\n

But now with implementation of the New Companies Act from April 1, 2014, \u201cGold Saving Schemes\u201d in present form is illegal<\/strong> until they comply with the new regulations.<\/p>\n

What has changed with New Companies Act?<\/h2>\n

The Companies Act says that any deposit taken where the delivery of goods is after then 365 days, it would be considered as \u201cPublic Deposit<\/strong>\u201d. Now these deposits are governed by a set of rules. These are:<\/p>\n

    \n
  1. Appointment of Independent Trustee<\/span><\/li>\n
  2. A Deposit Redemption Reserve<\/span><\/li>\n
  3. Get Credit Rating for the Company<\/span><\/li>\n
  4. The total deposits has to be less than 25% of the net worth of the company<\/span><\/li>\n
  5. Mandatory Disclosures such as any default in the past, legal cases, etc<\/span><\/li>\n
  6. Get deposit insurance cover<\/span><\/li>\n
  7. The maximum interest that can be offered should be\u00a0less than 12% per annum<\/span><\/li>\n<\/ol>\n

    So essentially, the new Company Act has made companies difficult to launch such schemes but the good thing is the customers are much more protected now. Also to be compliant, the companies need to return such deposits before April 1, 2015.<\/strong><\/p>\n

    Tanishq Golden Harvest and Swarna Nidhi Scheme:<\/h2>\n

    Golden Harvest and Swarna Nidhi Scheme were popular \u201cGold Saving Scheme\u201d from Tanishq. But to be compliant with the new regulations they have to close these schemes and return the deposits to customers.
    \nHere is the notice that Tanishq published for their Golden harvest and Swarna nidhi Customers:<\/p>\n

    \"Tanishq
    Tanishq Golden Harvest and Swarna Nidhi Scheme Closure Notice<\/strong><\/figcaption><\/figure>\n

    Here is the Summary:<\/strong><\/p>\n