How to buy gold coins in India?

by Manshu on April 14, 2010

in Investments

I have written about investing in gold through gold ETFs, and gold monthly income plans in the past, but there is a more direct way to invest in gold, and that is by buying gold coins. I use the word direct because you buy physical gold, and don’t have to pay fees to the middle-man, thereby eliminating at least one layer in between.

The flip – side is that you will have to store physical gold with you, but most of you would have bank lockers to store jewelery anyway.

Here are a few things you should know about buying gold coins in India:

1. Reputed banks sell gold coins: The most important thing to me is that reputed banks like SBI also sell gold coins, and that reduces the chances of fraud, and someone selling you something which is of less purity than they claim. A lot of banks have entered this space, and they sell gold coins through their branches. Not every branch will sell you gold coins, so you need to go to the bank’s website and find out the closest branch that will do so.

2. Different sizes: Gold coins are available in different sizes, so you can buy the ones that suits your needs the most. The usual sizes are coins of 2, 4, 5, 8, 10, 20 and 50 grams. The coins are 24 carats, and the banks guarantee their purity too.

3. PAN needed if you are buying gold coins worth more than Rs.50,000: If you plan to buy gold coins worth more than Rs.50,000 then the bank will ask you for your PAN details. I don’t think a jeweler will ask for similar documentation, and that might be one reason to go to a jeweler to buy a gold coin.

4. Banks won’t buy – back your gold coin: I have not seen any banks that you can sell your gold coins to. They are happy to sell you their gold coins, but you can’t go to them and sell it back to them. You will have to sell the gold coins to the jeweler, and this is probably another reason for buying gold coins from jewelers in the first place.

5. You might pay a premium for buying gold from a bank: Now, I started off extolling the virtues of buying gold coins from reputed banks, and I will end this post by mentioning that if you compare prices between your local jeweler and some banks – you might find a difference. There will be a difference even when they guarantee the same purity. A lot of people think that this premium is worth it because the price is higher when you go to sell the gold, but that is not always true. You don’t get this premium while selling off your gold coin. In effect, buying gold coins from your jeweler might turn out to be cheaper than buying it from a bank. It is up to you to decide whether the difference in price is worth it to you or not.

These were just some points that you should keep in mind while buying gold coins – I am going to write more about this topic in the future because a lot of people are interested in this, and would love to hear if any of you have had any experience with buying gold coins.

{ 109 comments… read them below or add one }

modihemal June 11, 2010 at 4:22 am

please send the price of gold per 1 and 10 gm in rupee.


n.ramakrishnan June 1, 2011 at 1:32 am

buying gold coin with the reputed jeweller is always better. banks are having gold coins. but they are very expensiv e as they charge 8% plus from the gold rate. Any further suggestion you can write to my email.


alok September 24, 2011 at 2:04 pm

How we Purchase the gold coin through bank and jewller and who is benificial to us and whats the taxes is applicable by gov and jweller.If i want to sell the coin then how we will sell?


alok September 24, 2011 at 2:05 pm

you also contact me my no…7827072609…….


kavita June 22, 2010 at 5:57 am

hdfc bank now has a scheme where they do buy back the gold coins.


Manshu June 22, 2010 at 6:08 am

I think the website is still not updated with the info. Can you share your experience with us please?


Ashok Khanna November 3, 2010 at 4:40 am

My experience of buying physical gold is that, a jeweller will claim that his gold is pure & he will buy back at the days price,less 3% if you want to sell it back to the same shop. But he will not honour the gold from another jeweller.
e.g. Tribhuwandas will not buy gold coins of Chintamani jewellers at the same price of the day at his shop, as he will claim that the gold from Chintamani is not pure, and also vise versa. That means that all gold from jewellers is not pure at all.
The price at the jeweller will always be about Rs. 1000 + more than the price in the market, for reasons of making charges, storing, tax etc etc.
The captal gain on physical gold is zero only after 36 months of purchase.

I want to know which is the best Gold ETF to buy. Have learnt that the BEES has the best lowest charges and highest turn over.
Where do I get the info as to how any ETF has performed in the last month, quarter, year etc ?
Can anybody advise where to study the ETFs in the markets for perfomance.


Manshu November 3, 2010 at 6:30 am

Thanks a lot for sharing your experience Ashok – this is exactly the kind of information I was hoping someone would share based on their own experience.

As to your point about Gold ETFs. I did a post comparing the two year returns of various gold ETFs in April here:

Then there is a post that also has the volume and expense data on these ETFs.

These posts are a few months old, and if you would like to do current research yourself you can go to and find these under the ETFs tab.

Thanks again for your wonderful comment!


shamnoon ahamed July 20, 2010 at 7:59 am

i need to know the rules of indian government for selling gold,silver coins for a gold smith.i would also like to know some buyers of gold,silver coins in india


Manshu July 20, 2010 at 3:48 pm

You can check with your local jeweler if you are in India, as that might be the most convenient way of buying and selling gold coins. If you are not in India, and need to import it to some other country then it becomes slightly more complicated than that.


raghu August 12, 2010 at 2:01 am

Dont buy from banks..
they will cheat u.. be careful

I have done same mistake as in the blog, lost 150-300 RS per gram.


ASHA October 11, 2010 at 11:43 pm

Infact I want to buy gold n silver oins of 50 gms today. so i need the todays price. Iwant to know where i wll get cheaper a comparable statement shud be given to me.


Manshu October 12, 2010 at 4:03 am

SBI’s website shows that today’s price of 50 grams gold coin is Rs. 104,790

The Sify website shows that the per gram 24k gold price is Rs. 1962

For other prices, you’ll have to visit or call a local jeweler.


ASHA October 11, 2010 at 11:46 pm

I want to buy 50 gm gold coins. How much i have to pay for this n from shwee i will get cheap


Manshu October 12, 2010 at 2:44 am

The cheapest will probably be your local jeweler.


Prakash November 30, 2010 at 11:11 pm

SBI is not cheap. Over the price they add VAT also, so beware. I think best to invest in E-gold as there is no risk of theft.


Manshu December 1, 2010 at 8:23 am

My only concern with E-Gold is that it’s a relatively new product, so I personally would prefer a gold ETF, but that’s just my choice.


Avinash Taneja April 8, 2011 at 11:55 am

Apply a VAT on sale is legal compulsion and ethical norms. Why to beware ?We must desisit from unethical norms by saving merely by a petty gain of 1%. This type of petty gain for the sake of saving tax is also similar to corruption. These are my sentiments but your views may be different from me.


Ninna January 15, 2011 at 4:23 am

What would be the price of 10 grams gold on 31-12-2011


Manshu January 15, 2011 at 6:14 am

So, price at the end of this year? I don’t know that and if anyone tells you what the price will be that’s just their opinion, which they will give you since you’re asking but keep in mind that no one knows what the price will be for sure. If they knew it they would be busy making money with that info not sharing it on blogs.


kuber agrawal January 28, 2011 at 6:49 am

Is there any condition when Bank can buy back the gold or they don’t buyback???
If we return gold to Tanishq which was earlier purchased then we will get money in cash or through cheque???


Manshu January 29, 2011 at 8:39 am

Banks don’t buy them in any case.
Don’t know if they buy it back and give cash or check.


nikhil February 19, 2011 at 9:37 am

I purchased gold coin from INDIA post office by cash for rs 23000/- i want to ask from you if there is any tax or something whick i have to pay on it later on?


Manshu February 20, 2011 at 5:14 pm

Tax which you have to pay later….on sale you mean? Yeah when you sell it at a profit it will attract capital gains tax.


Ashok Khanna March 22, 2011 at 5:07 am

You are only partly correct Manshu. If the physical gold is sold after 3 years it does not attract capital gain tax, as I remember reading somewhere.
Somebody correct me if I am wrong.


Manshu March 22, 2011 at 6:18 am

I may be wrong, so please do share the link where you found this info that capital gains on gold is exempt. I searched a little again today and couldn’t find it.

Here is one link that I found which says that long term capital gains is taxable for gold after 3 years.


kuber agrawal January 28, 2011 at 6:51 am

Is this the rite time to purchased Gold or we can see more correction in that. At what price we must buy if then.


Manshu January 29, 2011 at 8:38 am

I don’t comment on price movements of short term so sorry.


Sanjeev March 1, 2011 at 6:01 am

Just got duped..
Bought 500 gms silver @ 3370/50 gms (discounted for being a classic customer)

paid 67400 /kg vs market price of 49915/kg

we should sue these banks.. will go to bank tomorrow & see if anything can be done.. will keep you all posted

HDFC Rates

Market price


Manshu March 3, 2011 at 8:30 am

Banks are selling silver also? Which bank is it and in which city?


Loney March 3, 2011 at 8:35 am

Only HDFC bank is selling silver as 50g bars.


Manshu March 3, 2011 at 8:49 am

Oh – I didn’t know about that – and they are charging a fat premium I guess, and then won’t be able to buy it back either?


Loney March 3, 2011 at 8:56 am



Manshu March 3, 2011 at 1:43 pm

Well then I better get ready for some more angry comments now!!!


dkshukla March 4, 2011 at 9:46 am

my dear friends HDFC selling silver and gold in temper proof packing but on hgh rate and you can not sell to the bank , ultimately you go to the market for selling .


Niraj Kothari March 10, 2011 at 1:30 am

Dear Everybody, I see that there has been a query on the quality of gold /silver and pricing , being a jeweler I would suggest is always buy either Silver / Gold from a reputed jeweller and stress for the NIBR 999 SILVER BAR of 1


Niraj Kothari March 10, 2011 at 1:32 am

Dear Everybody, I see that there has been a query/concerns on the quality of gold /silver and pricing , being a jeweler I would suggest is always buy either Silver / Gold from a reputed jeweller and stress for the NIBR( National Indian Bullion Refinery) 999 silver bar of 1 Kilo in Silver and NIBR 9950 gold bar of 100 grams in Gold, this way you are assured of purity and also competitive pricing.


Manshu March 10, 2011 at 5:31 pm

Thanks for this info Niraj – does this come as a certificate? How does this compare to the gold that banks sell?


Niraj Kothari March 11, 2011 at 12:59 am

Dear Manshu,

The bars of 99.50 purity from NIBR do not come with any kind of seperate certificate but the purity of the gold is mentioned on the bars itself.

Usually if a jeweller / company / banks sell gold with tamper proof packaging and gold purity mentioned on the package they start charging premium for this kind of service ,and the premiums vary from Rs.50 – Rs.250 per gram and my honest suggestion is there is no point in buying gold bars by paying such high premiums , because these institutions either don’t buy back the gold they have sold and the customer has to sell in local jewellery market , where the jeweller will buy gold at the current rates only.So your entire pemium for 100 grams which is Rs.5000 – Rs.25000 is LOST!!!
Also , some people always stress for 99.90 / 99.99 pure 100 gram gold bars, but as per indian governments BIS hallmarking norms gold bar of 99.50% is also 24kt gold and it is also called “Standard Gold”( Usually mentioned in leading newspapers under gold rate section ). Any jeweller the ultimate purchaser of gold from any customer will pay you full amount for 99.50% assayed 24kt standard gold bars.
In a nutshell , I would sum up my suggestions for anyone purchasing gold in the below points.
1. Purchase gold bars from a jeweller if and only if the jeweller is offering you gold bar from the below listed nationalised / recognised gold refinaries
a. National Indian Bullion Refinary ( NIBR )
b. Narrondass Manordass ( NM )
c. Riddhi Siddhi Bullions Pvt Ltd ( RSBL )
d. Minerals and Metals Trading Corportaion ( MMTC )

2. The gold bar should be assayed with 99.50 purity( marked on the bar ) and purchase the gold with bill from the jeweller.

3. Do not purchase gold bars/ coins from banks / financial institutions because in the name of providing high purity of 99.90 / 99.99 these institions charge you a very high premium which is lost when you sell the gold at a local jeweller. The local jeweller buys your gold at the purchase price of 99.50 standard gold only.

4. When you buy gold with a jeweller also look for his purchase price, usually there is a difference of Rs.100 – 300 / 10 gram between sell and purchase prices depending on market conditions across India.

Tips to buy 1 Kilo silver bar
1. Buy only a 1 Kilo silver bar of NIBR of 999 purity from a jeweller, this is also called “Choursa” in local language.
2. Buy the silver with a bill from the jeweller.
3. Look for the “NIBR 999” SEAL on the silver bar, these bars are available across India with every jeweller.
4. Again don’t buy silver from banks, because you end up paying high premiums.


Manshu March 11, 2011 at 5:45 pm

Dear Neeraj – Thank you for your detailed explanation – this is useful information, and I think a lot of readers will benefit from this.


Prahlad August 25, 2011 at 9:15 pm

Dear neeraj ,
thanks for you valuable informatiion. i visited your website. but didn’t find a. National Indian Bullion Refinary ( NIBR )
b. Narrondass Manordass ( NM )
c. Riddhi Siddhi Bullions Pvt Ltd ( RSBL )
d. Minerals and Metals Trading Corportaion ( MMTC )

can u send me link of some of the abvoe mentioned gold bars . so i can make purchase decision from y your online shop


Neel March 6, 2011 at 8:41 am

We really need Silver ETFs ASAP. When will SEBI get over with the fight and allow Silver Bees to start ops? I could have made over 2X by now 🙁


v.babjee March 4, 2011 at 9:42 am

this is in respect of gold rate also. i feel khazana jewellers is the fair one and it buy back or exchange the gold coins purchased from them. while hdfc bank takes premium amount in purchasing of gold coins,by highlighting purity,and they cant buy back their own gold coins.better to go to famous jewellery shops for purchase.


Juhi Sakhuja April 10, 2011 at 11:47 pm

Same here..Bought 100 gms silver from HDFC at 64000 per kg t a discounted price being imperia customer compared to market rate of 50000 per kg.

Regret buying it from bank Only solace is that its a long term investment. Dont know how long it will take to break even.

Latest is that HDFC is selling 100 gms at 8000 compared to jweller rate of 6200. robbers


amit March 14, 2011 at 4:57 am

I want to buy gold for my sisters marriage which will be in december 2012.
So i am planning to buy gold(in solid form) for making jewellery for her wedding.
Please let me know which month is the best to buy gold in solid form.


Niraj Kothari March 14, 2011 at 10:08 am

Dear Amit,

First of all, it is highly unpredictable to say in which month the gold rate will be lesser/ optimal so that you can buy buy pure gold .

I suggest you the below options by which I hope that you can take advantage of current high gold rate fluctuations and also get some benefit from jewellers schemes
1. You can go with monthly savings scheme / monthly fixed amount investment scheme with reputed jewellers in your city, the advantages of such type of schemes are
a. These monthly fixed amount investment schemes give you a bonus amount at the end of the scheme.
Ex: Deposit Rs.5000 / month for 13 months and get a bonus of Rs.5000 at the end of 14th month , so you will be benefitted to buy gold worth Rs.70000/- though you have deposited Rs.65000/- in total for 13 months.
b. These schemes have some discount on the making charges*
* The discount should be taken in written on the day when you start the scheme.
c. Usually the gold price is taken on the final day on which you purchase the jewellery.
d. Make sure that whether the jeweller is offering the bonus only on purchase of gold jewellery or also on purchase of on gold bullion( 24kt gold ).
e. The jewellery which you purchase should be all BIS 916 hallmarked on every product.
Ex: If you buy a 6 piece bangle set, EACH BANGLE should be 916 BIS hallmarked for 22kt gold and 958 Bis hallmarked for 23kt Gold.

2. You must have decided how many grams of gold jewellery you are planning to buy for your sisters marriage, so for Example , If I assume it to be 200 grams and you 20 more months in hand.
So, you can buy just 10.000 grams 24kt pure gold of 99.50 purity or above every month on a fixed date , this way you will make an average price at which you buy gold and also it won’t overload your investment portfolio/monthly budget.
At the end of Nov.2012 you will accumulate 200.00 grams of 24kt gold, now when you go to a jeweller to exchange this 22kt gold jewellery , make sure of the below mentioned points.
a. Your 24kt gold should be converted in cash at that day’s prevailing 24kt gold purchase rate of the jeweller.( Rs.100 – Rs.300 / 10 grams is difference between sale and purchase price of 24kt gold at reputed jewellers )
b. You pay ornament rate + making charges to the jeweller for the jewellery you purchase , in this total amount your 24kt gold total value should be deducted.
c. Again make sure you buy in Bill/ and all the jewellery is 916 BIS hallmarked.

Hope the above information is useful to you…


Manshu March 14, 2011 at 3:29 pm

Thank you for your comment Niraj – I’ve not seen such elaborate thoughts on the subject ever – really impressive thank you!


deepika March 17, 2011 at 9:09 pm

I want to buy gold coins in SBI can I buy?can anyone tell me about this?


Manshu March 18, 2011 at 7:47 am

You can go to a SBI branch and get it Deepika. I do hope that you have gone through the comments and seen the issues people face with selling the coins though.


Avinash Taneja March 20, 2011 at 1:17 am

Please go through the Retail Sale of Gold coin scheme and GAQ on that on SBI’s website There are around 1200 authorised branches all over India authorised to sell Gold coin. You can contact the nearesrt branch of SBI or the contact centre Helpline 1800 11 22 11 (Toll Free from BSNL / MTNL landline) or 080-2659 9990 (other lines) for nay query. Daily rates of Gold coins are also being displayed on the website.


Manshu March 21, 2011 at 10:55 am

Thanks for taking time out and giving such a detailed reply Avinash.


Avinash Taneja April 2, 2011 at 8:39 am

List of authorised branches selling Gold Coins in SBI are also displayed on the website on the following link


Manshu April 3, 2011 at 3:43 pm

Thanks for the link Avinash.


Avinash Taneja March 20, 2011 at 1:19 am

Please make correction GAQ to FAQ


RAKESH March 20, 2011 at 1:44 am

I will require 200 gm gold after 10 years, at my daughter’s marriage. What should I do ? Should I puchase now at this point or wait for the correction in gold price?
Please guide.
– RAKESH DAVE, Ahmedabad.


Manshu March 21, 2011 at 10:54 am

Well, I don’t think anyone can predict how gold prices will move, and my opinion has always been to try and regularly invest instead of trying to time the market since you never know what will happen.


RAKESH March 31, 2011 at 10:28 am

Thanks a lot, Manshubhai. Further I want to understand why SIP in GOLD ETF is not available ?

– Rakesh , Ahmedabad


Manshu April 3, 2011 at 4:16 pm

I think you posted that question again and I answered it there. Right?


Varsha choudhary March 22, 2011 at 1:58 am

I want bye sbi gold.what is it’s proses ? Please give me some info.


Manshu March 22, 2011 at 4:07 pm

Please visit a branch as mentioned in an earlier comment, and they will be able to explain the process in great detail.


Nole March 24, 2011 at 1:25 pm

I recently (several years ago) purchased gold 100 grams at 22 karat purity as a coin from a reputed local jewelery shop in Chennai. However, when I decided to change it into bangles from another shop I was having trouble because apparently the purity changed while I kept it in my locker. However, the original jeweler is able to take it back for the same purity. Finally I returned back without purchasing. Is there a standard way to test the gold purity immaterial of how much these local jewelers might pay for it?
I would really like to test all my jewelery (both silver and gold) using a third party accurately. And I do not want this scratch type testing. I looked up online and there was this spectrometer based testing. Can someone please tell me if I can get my jewels tested for purity professionally using this machine? I am even willing to pay for such a service. I wanted to buy this device and would have bought it had it been only a few thousand rupees, but this one is really expensive.


Manshu March 24, 2011 at 4:33 pm

I really have no clue about this, but I hope another reader who has experience leaves a response to you.


Nole March 24, 2011 at 7:47 pm

My other question is, there are 2 rates for silver given in the newspapers.
1) Bar silver
2) Ornamental solver
And the bar silver is cheaper than the ornamental silver for several 1000 Rs for 1 kilo. Which one is purer and when I sell it back, which one goes for higher rate.
This is confusing because, most jewelers take some % of the value while buying back from customers. Now when we sell bar silver will they take a % from the bar silver rate and when we sell ornamental silver will they take a % from the ornamental silver rate? How can the bar silver be of less value than ornamental silver if it is infact more pure?
There is something fishy in this market. And all the more these jewelers do not buy each others metals and this further confirms my suspicions. Anyone who can shed light in this matter would be appreciated.


Niraj Kothari March 24, 2011 at 11:02 pm

Dear Mr.Nole,

Firstly I would like to clarify some myths which exists in the market for gold jewellery

1. GOLD no matter whatever purity you buy will never get impure / corroded/ degraded / decrease or increase in weight even 0.o5o grams , if you keep it in a safe place even for 100 years, it is this property of gold that has made it valuable.
So the jeweler who advised you that your purity of gold changed while you kept in the locker for a while is incorrect.
The purity of gold when you buy it from a jeweller will remain same and will never change with time, if someone says that the gold is of less purity than you had bought it, then it implies that the jeweller from where you bought the gold has sold you gold less than the assured purity.

Now , concerning your point of testing your jewellery through a spectrometer, as you rightly mentioned spectrometer / karotometer ( commonly used ) are very costly and the pricing of karotometer ranges between 6 lakhs to 12 lakhs!.
So how a common should get his jewellery tested ??
The solution to this is , usually across India Government of India has recognised BIS hallmarking centres, these centres are usually located in main wholesale / retail jewellery market areas of the particualar city, like in chennai it should be located nearby T Nagar.
You can walk into these hallmarking centres with your jewellery and ask them to test the jewellery for the purity which jeweller has assured you.
During the testing the hallmarking centres are required to cut upto 0.100 – 0.200 grams behind every product and subject it to different gold testing methods like
1. Fire assay test.
2. Spectrometer test
3. Nitric Acid and Touchstone scratch test
They then take an average of all these different methods of testing and give you a certificate of purity for the jewellery product which you have given, and also they give you that 0.100 – 0.300 grams of gold back which they had taken from your ornament , in the form of pure gold.
These reports are completely unbiased and authentic from a government recognised hallmarking centre. The charges are Rs.20 / per product or piece. The process requires between 3 – 5 hours.

Note: Kindly confirm the process with BIS hallmarking centre of your city before handing over your products for testing.


Nole March 25, 2011 at 3:20 am

Dear Niraj,
Thank you for the clarification on the storage of gold. I feel that this standardized testing is the best solution.
Because, for the same gold coin, the jeweler from whom I bought is quoting a higher purity while another jeweler is quoting lesser purity. I was sent back and forth a couple of times and this completely frustrated me out. These are the big reputed jewelry shops in the T Nagar area.
I am very much interested in this government run BIS hallamarking center.
Could you please give me some contacts in T Nagar area?
Also do they check for both gold and silver?


Niraj Kothari March 25, 2011 at 4:46 am

Dear Nole,
Kindly follow the below link for BIS hallmarking centre in Chennai T Nagar


Manshu March 27, 2011 at 9:23 am

Wow this is pretty detailed and amazing info – thank you so much!


E.ILANGO April 8, 2011 at 8:39 am

Dear Mr Nole, May I please know how purity can change while in a locker ? Gold is not known to lose purity merely by time passing. It can look old if it was used. The Karat meter machine is in some shops (Khazana, Tanishq, etc.) in Chennai but may show the purity of only the outer layer (skin touch) and not the inner parts of the piece of gold. A more sure way to test is by chemical analysis i.e., by cutting a sample of a piece of gold and treating it with certain chemicals in a laboratory. That will cost you & make you lose that gold sample piece itself. You will only know the purity of that sample part of the piece. Only because it is taken from the whole piece you may think that the result of the test is fit for the whole piece. It is a costly test. Also by melting the gold it is possible to know the purity. It will cost much and make the piece lose its shape and needs to be again made. It is also costly.
A jeweller in Chennai bought gold from another so called “reputed” jeweller shop who has a shop in U.P. , Dubai & Singapore and paid a tax and got a receipt. He tested the gold and found that its skin touch was 22% but inside purity was only 18 %.


Nole March 25, 2011 at 3:45 am

Sorry, I wrote soon. For others who might be interested the contact centers are given here:


Dr.Amit Ghosh March 25, 2011 at 8:52 pm

I have recently purchased a gold coin fromSBI,for which they have given me a purity certificate (supposedly) which I think is useless for the following reason:

The certified pack containing the coin does not carry a number, serial or reference,hence one cannot claim that the certificate indeed refers to the “pack”
in case of a dispute.

Does all SBI gold coin packs come without a serial or reference no. ? ( On the pack itself there is a place for number,however it is blank in the gold coin pack that I havebeen given). Or have I got something “SPECIAL” ? Can anyone enlighten me
please, before I take up the issue with SBI. I will be thankful.


Avinash Taneja April 4, 2011 at 1:43 am

SBI presently sell 2gms, 4gms, 5gms, 8gms, 10gms, 20gms, 50 gms and 100gms coins to retail investors. While the coins of denominations of 20gms, 50gms and 100 gms are serially numbered, the others are not. You have not specified which denominations of coin you have purchased from SBI.
Further as regards the purity of the coin is concerned you should not have any doubt about it as the same has been purchased from the reputed organisation viz. SBI.
Even if you have any doubt about its purity you can get it verified/tested from the Govt. approved shop/establishment . Once you are satisfied about its purity, the Bank’s purity certificate is no longer required by you. If not it can be claimed from the Bank even without packing.


karthik March 29, 2011 at 1:09 pm

I have regular requirements of gold, ie 600 grams to 2 kgs everyday as an retailer, & m already purchasing it from RSPL bullion on market price, but I heard of discounted gold can anyone pls out there let me know is real or myth.
Thank you.


E.ILANGO April 8, 2011 at 8:50 am

Dear Mr Karthik, The Tirumalai Tirupati Devasthanam, Andhra Pradesh temple sells by auction the gold it gets as donations. The quality& purity may differ from one piece of ornament to another. The dates, terms & conditions may be got from it. Shops also sell gold below the market price if they are not members of the gold jewellers association to attract buyers. Whether their purity is high or low or as they claim is not known. One shop in Chennai stated on its notice board that other shops sell at a discount only as the purity is low. It later sold at a discount and removed its notice. It made people suspect its purity.


Avinash Taneja April 8, 2011 at 12:07 pm

Dear Karthik,
You can get coins from banks at a discount as they offer discount on bulk purchase i.e. 500 gms or more. U can get the same from SBI also a discount which depends upto your quantity required. If u need any contact I can supply the same to you.


swathi April 1, 2011 at 9:37 pm

1.Howmuch difference between marketing and banking prices when i am purchaging gold in any bank?
2.Is there any difference in price when campared with one baank to other bank?
3.Banks won’t buy – back my gold coin then where is it i am selling?
if iam going to sell it to jewllery shop then it is profit or loss to me?
4.what is the present price of 1gram gold?
in future(2-3mn) what is increment i am expecting?


Niraj Kothari April 2, 2011 at 3:03 am

Dear Ms.Swathi

I have answered to your concerns inline accordingly
1.How much difference between marketing and banking prices when i am purchaging gold in any bank?
When you buy gold coins/biscuits from banks, the purity will be either 99.90 or 99.99 with tamper proof seal pack and assayed by swiss assayer “Essayeur Fondeuer”, for this they charge you a premium or making charges of Rs.100 – Rs.300 / gram which is very expensive in 24kt pure gold, where as if you buy in local jewellery market, you have to buy 99.50 / 99.90 pure gold bars where you pay Rs.0 – Rs.20 / gram as making charges!!, so it is advisable to purchase gold from your local jeweller with bill and purity mentioned on the gold biscuit and also on bill.
2.Is there any difference in price when campared with one baank to other bank?
Yes, every bank has different price for 99.99 seal packed tamper proof gold coins/ biscuits irrespective of their vendor/supplier being the same – in this case VALCAMBI SUISSE and PAMP.
3.Banks won’t buy – back my gold coin then where is it i am selling?
if iam going to sell it to jewllery shop then it is profit or loss to me?
The first loss you have incurred on the day when you have purchased gold from a bank at such high premiums, due to RBI norms banks don’t buy back gold, so the only option left with you is to sell in local jewellery market, where your gold will be purchased at current purchase price of 24kt gold( you won’t get any premium when you sell 99.99 tamper proof gold bars, though you have to pay to buy one)
4.what is the present price of 1gram gold?
in future(2-3mn) what is increment i am expecting?
The current price of gold is Rs.21150/10 grams, it may be variable depending upon the local taxes and duties as applicable in your city. It would be highly unpredictable to judge whether gold will have a bearish / bullish pattern ….


Manshu April 3, 2011 at 3:43 pm

Thanks Niraj.


RAKESH April 3, 2011 at 10:40 am

I want to understand why SIP in GOLD ETF is not available ?


Manshu April 3, 2011 at 3:37 pm

SIPs are generally done in mutual funds, and an ETF is not a mutual fund so that’s the reason.

However, these days ICICI Direct allows you to do a SIP in gold ETF and then there are some alternatives to this as you can read in this post:


Manshu April 20, 2011 at 11:15 am

I don’t think there is a particular month which is good to buy gold. There is no guarantee that the gold that’s bought in say Novemeber will be cheaper (or purer) than it is in December, so there really is no such thing is a best month to buy gold.


Sudip May 8, 2011 at 12:23 am

Thanks for the information. I recently went to bank and a jeweller and the differnce was around 2k. I thought of sharing another interesting article on investing on gold hope this would be helpful to everyone.


Faheem Yakub May 22, 2011 at 3:53 am

Thanks Niraj. You have made it Cristal clear..Much appreciated.


Ms.Nathan May 22, 2011 at 4:15 am

I have a question reg.purchase of gold coins for investment purpose. Whether to go in for
purchse of a 22 ct gold coin or 24 ct gold coin from a reputed jeweller. Which will be advisable, please advise me.


Niraj Kothari May 22, 2011 at 6:06 am

Dear Ms.Nathan,

No matter whether you buy a 24kt / 22kt gold coin/biscuit, but make sure what is the difference between sell price and purchase price of the jeweller for 10 grams. Though personally I suggest you to go with 24kt since it would be acceptble across cities in India


Ms.Nathan May 22, 2011 at 7:32 am

Thank you for your valuable suggestion!!!


anshuman May 24, 2011 at 11:41 am

Hi Manshu

Just wanted to share few facts from a recent purchase of gold (gold rate at banks was shockingly lowest on akshaya tritiya). I buy 10 gms of gold from bank and 10 gm from a jewellery chain at every 6 months interval. High level pointers below
– Banks charge a higher rate due to the assay certification. Also lot of people tend to confuse between pricing of 24 carat (at banks and higher) and 22 carat (most jewellers sell and lower). Banks will charge premium for certifying the purity which most jewellers will not give in writing. They only give a stamped paper of their own not a certificate from an independent assaying authority
– Banks are not allowed by RBI directives to trade in gold. Hence they cant buy the gold coin back. Privately speaking, lots of banks are trying to get the RBI to change this policy so in future (about 7-10 yrs from now) they will also buy back the gold. This should be good for long term investment purposes
– Jewellers sell 22 carat gold but they deduct (at tanishq, joy alukkas and 3-4 other chains) about 5% of the gold value when they buy back. Also they buyback only in exchange for jewellery purchases, not cashback
– Khazana jewellers is the only one who agreed to give full cashback on coins purchased from them, but all jewellers will deduct 5% on gold of any other source (on jewellery purchases), plus of course making charges of 20% – 40%
– Just like any other investment, gold buying should be irrespective of market timing and pricing. Sort of SIP i.e. a few grams every quarter or 6 monthly interval
– E-gold concept is in infancy and regulations are yet to be clear. Hence avoid in my humble opinion
– The gold harvest scheme of most jewellers (you pay a fixed amount for 11 months and the jeweller matches that in the 12th month) gives almost 11% returns. Pretty good SIP and helps time purchases like dhanteras, birthday, anniversary etc


Manshu May 28, 2011 at 10:25 am

Thanks for leaving such a detailed comment and sharing your experience Anshuman.


Niraj Kothari June 3, 2011 at 6:03 am

Dear Ansuman/ Manshu

Hello, this is in response to your sentence “lots of banks are trying to get the RBI to change this policy so in future (about 7-10 yrs from now) they will also buy back the gold. This should be good for long term investment purposes”.
In response to above statement , I would like to clarify that Banks will never buy back gold coins sold by them , the very reason for this is , if banks advocate this policy then the intrinsic value of Rupee will depreciate and our currency will fall and eventually economy. Also, to support my words you can search on google ” Central Banks Suppress gold prices “, for any Central Bank rising gold prices are not good for their currency, and if banks start buying back gold then people will eventually have more faith in Gold than in the Currency of the country.


Manshu June 6, 2011 at 3:57 pm

Dear Niraj – Thank you for all your wonderful comments here, and I have a post today that builds on something you wrote in a comment, however in this case I’d beg to differ. I think you’re getting mixed up with gold standard, or a currency that’s based on gold versus just the simple act of banks buying back gold that they sell.

While I agree that there is so much nominal currency out there that no country can go back to the gold standard, there is no reason for an economic collapse if banks were to buy back the gold they sold.


anshuman May 26, 2011 at 8:29 am

Also another point to be noted, HDFC bank gives discounts on the gold coin prices to its savings accounts holders. On akshay tritiya it was 5% (i.e. 95% of the value of gold that day at bank rates)… and on other days (e.g. last week when i went o buy some) i get 3%. This helps in reducing the cost of certification and i still get 999 grade pure gold.


n.ramakrishnan June 1, 2011 at 1:46 am

banks are always expensive only due to some costing/accounting reason. also they do not buy back. hence jewellers are best. but you need to buy with hall marking for the purity. hall marking is the gurentee for the purity. it does not matter whether you buy 22k or 24k but you should verify the price calculation according to the purity. generally 2-3% you can pay as making charges apart from gold rate and tax. any further clarification you can mail me up.


sangram June 20, 2011 at 4:39 pm

As you mentioned in the article, bank coins start at 2 gram denomination & they dont buy back coins due to RBI restrictions. Also local jewellers seem to deduct 2-3% on buy back. At caratlane, we have a 100% exchange policy where you can exchange your gold coins at 100% value anytime in the future.

After taking feedback from existing customers, we have added gold coins starting at 1 gram denomination going along the way to 50 grams (1 gm, 2 gm, 4 gm, 8 gm, 10 gm, 20 gm & 50 gm) coins.

Also personally i think 24 Karat gold coins make for a better invesment as compared to 22 Karat gold coins due to their acceptance level among retailers.


sangram June 20, 2011 at 4:46 pm

Banks do not buy back gold coins due to RBI regulations & all major jewellers also deduct 2-5% on buy back of coins.

After taking feedback from our customers, we have introduced a 1 gram coin (which are again not carried by Banks) & a 100% exchange policy on coins (where you can exchange the gold coin with jewellery or other coins at 100% value).

Personally I would prefer 24 Karat gold coins over 22 karat coins for investment purpose due to their wide spread acceptability.
Hope that helps.


Pritom June 21, 2011 at 10:32 pm

I’m planning for buying some gold as investment in near future. Initially I was planning to buy it from SBI/Axis/BANK OF BARODA/BANK OF INDIA/ICICI, but after going through this blog of Manshubhai, especially the Clinical writing of Mr Niraj Kothari, and going through the details of different banks, my conclusion is that its better to buy gold from a reputed local jeweler provided, the gold that supplied is pure as the jeweler claims and certifies that in the bill and also as per correct market rate of the day. But having concluded that now I’m facing some problems:
1. I live in Karimganj, a remote town in southern Assam. In my area there is only one Hall Mark registered jeweler who sells gold coins occasionally depending on demand and his rates are higher than the market rate of the day too. Others are not registered as far as my knowledge. Our nearest growing town (city) is Silchar, where there are a few Hall Mark registered jeweler but I doubt to trust them.
Q. What should I do? Please give me some suggestions.
2. About the selling of gold or exchange of gold in future, the jeweler I visited in my town, in his words – he will buy back the gold at my purchased rate minus VAT%. I think this is also a kind of cheating.
Q. Is there any Govt. Rules to prevent such type of act?
3. Mr Niraj, thanks for your explanations about the quality of gold bars and silver bars, which has enlighten me very much, but you have written about the standards of 100gm and 10gm bars. I’m a small employee of quasi-govt. corporation. I can save only Rs 2000/- per month and there is no system advance deposit scheme for gold from the jeweler here. Savings through RD in banks is not an option for me as the amount may not be the same every month or regular. So, if I’ve to purchase gold, I’ve to purchase it every 2 or 3 months, may be in denomination of 1gm coin or 2 gm coin. How can I look for standards you have mentioned? What do you suggest?


Manshu June 22, 2011 at 9:33 pm

Pritom, in your situation you’re probably better off buying a gold ETF rather than physical gold. However, I would like to add that it appears to me that you plan to invest most of your savings in gold, which is not a good idea. You will be risking yourself too much to one asset which has seen a lot of rise in recent times, which also means it can come down in value.

You’re better off diversifying and invest in different assets and hedge yourself.


Pritom June 22, 2011 at 11:46 pm

Yes, Manshubhai, you are right, but in my place there is not many options left for me. But still I’ve made some investments in different sectors like Mutual Funds (SBI Monthly SIP), ULIP based Pension Plan from LICI and Birla Sunlife (Quarterly Mode), some monthly recurring deposit and some endowment type insurance plans in last one year or so. Now willing to invest the surplus amount that is left with me in Gold for now.
I’m also doing my home work on direct share trading (in small scale) and other investment options like ETFs, etc. But my knowledge in this sector is limited and need your suggestions.


Pritom June 22, 2011 at 11:54 pm

Manshubhai, do you know anything about FundsIndia, which provides platform for MFs, ETFs, Equity investments? I like to know more about them. There website link is:


Manshu June 23, 2011 at 11:10 pm

No, sorry, not enough to comment about them.


Manshu June 23, 2011 at 11:11 pm

Okay Pritom – so looks like you already have a lot of investments and want to add gold to that list as well.

If you are thinking of opening a share trading account then I’d say use that to buy a gold ETF like Quantum or Benchmark Gold Bees. That will kill two birds in one stone, and is going to be cheaper as well, and easier to sell later on as well.


Pritom June 24, 2011 at 8:27 pm

Thanks Manshubhai.
It seems that for investing in ETFs, one should demat a/c. I’ve few confusions regarding opening of demat and trading a/c : I’ve my saving a/c with both SBI and Union Bank, both of them provide demat a/c facility. Is it better to open a demat a/c with these banks or with the brokers/DP, like Unicon, Indiainfoline, or ShareKhan and taking Netbanking facility from the said banks?
Also What is trading a/c? What is the difference between demat and trading a/c? Is trading a/c necessary for share trading (in small scales) or ETF investment? How they work together?


Manshu June 28, 2011 at 8:13 pm

You can open a Demat wherever it’s cheapest. You won’t get any additional benefit of opening a Demat from one place to another.

A demat account is for holding stocks and bonds, while a trading account enables you to buy shares, mutual funds etc. online. In your case it might turn out to be a very good thing because a lot of things are Demat these days and will be accessible to you online. Be sure to open Demat and Trading account together at the same place because that will be cheaper.

Here is an article about it:


Peter June 22, 2011 at 1:17 pm

Buy gold coins only from Banks /Head Post Offices to ensure 99.9% purity in pilfer proof packs. Otherwise youcan be cheated easily in Sarrafa Bazar. Promise have no meanings when you sell these in future for money. It will be your good luck if the price of gold are higher than
purchased price at that time. Deductions are certain when you sell gold/silver/ornaments in
Sarrafa Bazar.


jason August 11, 2011 at 6:15 pm

Dear Mr Kothari,
Thank you for your inputs that are so valuable for people like me not versed with this field. I have a few querries :
1. As per your advice,I did go to a few jewellers in Mumbai and found that the coins they claimed to be NIBR certified and in a tamper proof pack, were actually in very flimsy packs … Is it possible to tamper with those packs?… I mean, is it pssible to pack a substandard coin in a pack mentioning NIBR certification for 9995 purity?
2. There is no seperate certification with these coins although jewellers are ready to mention the weight and the purity of the coins on the pucca bill ( +1% VAT). But the same mention is possible on unpacked coins that are more economical. ( 22700 for 8 gm NIBR , 22200 if loose with a certified bill) . If the bill is going to be the proof, why to insist on NIBR coins?
3. If NIBR coins are really trustworthy, could I buy them from the NIBR outlet in Zaveri Bazzar and not from a jeweller?
4. the NIBR website clearly mentions that the source of their gold is refining. This includes dust scrap etc. Is the quality of gold at par with that obtained from Swiss sources….. i e the bank gold coins? Besides, NIBR is not a government institute but a purely private party. is it still that trustworthy as is implied in your blog?

Kindly answer these querries and oblige.

thank you.


Alvito T August 12, 2011 at 4:12 pm

I have just purchased a gold bar for 26500 from a local jeweler. I am concerned about its safety & purity after reading the posts in this thread.
I would like to know everything one needs to know about Gold ETFs & investing in them.
Can you please help me Sir?


ashish kesharwani August 17, 2011 at 7:29 pm

i have 50000rupees . plz advise me that how should i invest my money ingold


Manshu August 18, 2011 at 4:35 am

It really depends on what you are comfortable with – the three main options are buying gold coins, buying ETFs or buying mutual funds that in turn own ETFs.


James John August 22, 2011 at 2:18 pm

Hi to all readers

depends on your purpose of buying gold coins makes your job easy.
if you buying is and looking for pure quality without cheating , buy from bank as they gives guarantee instead they charge more getting compare to shop that because of premium that you dnt get it back if you are selling it later on.

At shop you pay only for the gold price what you buy but same time you have no guarantee of purity so if its for investment for short term better to but from trusty known jeweller shop

any way enquire by your self and decied


Muddassir August 24, 2011 at 2:39 pm

Neeraj: Dude you rock… You comments helped me a lot… Whoever will read this Article will definately thank you 🙂


wael August 26, 2011 at 6:30 am

which one is better and acceptable joyalukkas or pamp if buying gold bars ?


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