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Gold sold in post offices-banks cheaper and more pure?

Chennai,Nov 11 () : Gold buyers are being wooed by big and mid-size jewellery shops and banks along with Indian post offices are in the fray offering 7 % discount.

As Diwali is nearing and the gold buying pace has increased with banks and post offices in select areas working today. Apart from the physical buying of gold one can buy e-gold and gold exchange traded funds which gives you paper gold showing the quantity you hold. A round-up of the city’s jewellery shops show that despite the 7 % discount on gold of 24 carat 99.99 per cent purity and going rate being Rs 31,600 per 10 gms from the post office, the price is lesser in private retail.

GRT, Tanishq, Joy Alukkas, SBI and Bank of Maharashtra are giving gold at prices lesser than post office. The shops fixed the base price at Rs 3174 for 1 gm and a 4% increase which includes VAT and comes to Rs 3031 per gm and offers the same purity. 5 gm gold coin is Rs 18,922.5 in post offices. It means Rs 3758 per gm and reducing 7% it comes to Rs 3250 per gm.

The question that arises is that whether the gold sold in post office has more purity than with the retailers. Retailers point out that those buying gold from post offices when they have a need to sell them will have to come to them as post offices and banks do not buy them or exchange them. Retailers pay cash for gold brought from them and otherwise only offer to exchange them for new gold at then rates.

Banks and post offices offer gold in tamper-proof packing and with a assayer certificate which retailers say that they too offer the same. Veteran goldsmiths say that those who have long association with shops that they trust don’t look elsewhere but first time buyers should drop in at many shops without going by advertisements. For those who are ignorant about gold certification like BIS and making charges but want it as investment can blindly buy from the banks and post offices, says goldsmiths.