Should you invest in TBZ new gold plan scheme?
During this festival season, Tribhovandas Bhimji Zaveri (TBZ) has launched new gold plan scheme last week. As per TBZ Gold Plan scheme when you deposit gold coins or gold bars with them, they would pay additional 5% in the form of gold after one year. Here are more details on TBZ new gold plan scheme.
TBZ Gold Plan scheme
TBZ launched this scheme indicating that you can multiply your gold under this plan. If you have initial deposit of 100 grams gold, you would get additional 5 grams of gold after 1 year. If you buy gold from TBZ and deposit with them, you would get 10 grams of gold for every 100 grams of initial deposit.
Also read: Should gold lovers invest in GRT Flexi Gold Plan?
Features of TBZ Gold Plan Scheme
- You can deposit 24 karat gold coins or gold bars
- You need to deposit minimum of 10 grams of gold and in multiples of 5 grams there-on
- The maturity period is 361 days. After maturity, it earns interest in the form of gold.
- Participants can do redemption with accrued interest within 90 days. However you need to pay Rs 500 as processing fees and necessary taxes would be deducted on any interest accrued in the form of gold.
- TBZ verifies the gold deposited by participants about purity. Based on verification they would accept gold in this gold deposit scheme.
- TBZ would melt the deposited gold and use this for business purpose. Equivalent gold would be returned after maturity along with accrued interest in the form of gold.
- No cash interest would be paid.
- You can withdraw from this scheme and get your gold before maturity. However you would not get any benefit from this scheme if you go for premature closure.
- TDS would be deducted on interest accrued at maturity.
How far this gold scheme is good?
Looking from investment perspective, if you invest Rs 100, you are getting Rs 5 i.e. 5% as returns excluding gold price fluctuations. If you are gold lover and want to accumulate physical gold (in the form of gold bar or gold coins) over a period of time, then instead of just keeping your gold in bank locker, you can deposit gold / invest in such schemes and get 5% more gold after a year. If you are planning to buy gold and keep it in locker, you can directly purchase it from TBZ and deposit in this scheme. This way you would get 10 grams of gold for every 100 grams of initial deposit.
Also read: Do you really get benefitted from Gold Saving Schemes in India
Is it safe to invest in TBZ gold schemes?
Now the final question comes to your mind that is it safe to invest in TBZ Gold schemes. Crisil rated this company as A-/Stable for long term rating and Crisil A2+ as short term rating .
Conclusion: Personally, I prefer to invest in Gold ETF's rather than investing in these gold saving scheme as my motive is not to accumulate physical gold. If you are interested in accumulating physical gold over a period of time, you can look for such gold saving schemes as they would be the best investment for such individuals.
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TBZ new gold plan scheme
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In your conclusion, you said that you prefer to buy Gold ETF.In gold ETFs expense ratio is around 1%,so value of your Gold ETFs will be down by around 1% every year,instead buy MGOLD ETF,and when qty accured reaches above 100, convert into physical gold and deposit it in TBZ Gold deposit plan and instead of losing 1% per year, earn 5% per year.
Hi Manish, What is MGOLD ETF ? I could not understand. Please clarify
MGOLD ETF is Motilal Oswal Gold ETF, only ETF in which you can convert ETF in Physical gold by paying some amount in denomination 10gm/100gm/1000gm.Listed in BSE/NSE
Manish, I had quick review and this product looks good. I would analyse and post an article. Thanks for giving me a tip on such good product.