Gold sales likely to revive during Diwali as KYC norms eased

New Delhi, Delhi, IndiaUpdated: Oct 10, 2017, 11:02 AM IST
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Gold prices were ruling firm at Rs 30,555 per 10 grams Photograph:(Reuters)

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Higher sales are expected on Dhanteras which will be celebrated on October 17

Gold sales are likely to revive during the Diwali festival with the government revoking an order that mandated PAN and Aadhaar cards for purchases above Rs 50,000, an industry body said.

Higher sales are expected on Dhanteras to be celebrated on October 17. Dhanteras is considered to be an auspicious day for buying gold, silver and other valuables and is largely celebrated in North and West India.

Gold prices were ruling firm at Rs 30,555 per 10 grams and silver at Rs 40,600 per kg in the national capital as of Saturday.

"This is a big relief and there could not have been a better Diwali gift than this for both jewellers and consumers," All India Gems and Jewellery Federation Chairman Nitin Kandelwal said.

"We are expecting sales to revive after a lull in preceding months. We will be more than happy if sales remain normal during Diwali," he said.

More than jewellers, consumers were affected with the notification as they were not comfortable showing PAN and Aadhaar documents. "The rollback of this order will definitely improve ease of doing business," he said.

However, there is a need to create more awareness about the development among consumers, he added.

Echoing views, Kerala-based Kalyan Jewellers Director Rajesh Kalyanraman said it's a "positive" move and should help improve sales in the coming days.

"Sales were down in last two months...We are hoping Diwali sales to be positive. We are expecting a 15 per cent growth from over year-ago period," he said.

During last Dhanteras, gold and jewellery sales had risen by up to 25 per cent on higher demand in view of good monsoon and favourable price levels, as per the industry body data.

Mobile wallet company Paytm Vice President Nitin Misra said: "We have consistently held Paytm Gold buyers to the highest standards by ensuring 100 per cent digital transactions and fulfilling all PMLA requirements".

The company will continue to ensure best-in-class practices for customer KYC and provide a reliable and convenient platform for gold buying this festive season regardless of budget, he said in a statement.

In a notification issued on August 23, the government had brought jewellery dealers under the purview of the Prevention of Money Laundering Act 2002 (PMLA) and were told to report on buyers making purchases over Rs 50,000. Therefore, PAN and Aadhaar cards were made mandatory as part of 'Know your customer (KYC)' rule.

A decision to revoke the said notification was taken in the GST Council meeting held last week.

India is the world's largest gold consumer and imports a sizeable chunk of its total annual consumption of around 900-1,000 tonnes.