Mumbai: Targeting an estimated Rs two lakh crore organised gold market in the country, Reliance Money on Thursday launched a new daily gold accumulation plan under which customers can invest as low as Rs 1,000 per month.
Under the plan, named Reliance My Gold Plan, the customer can invest a minimum of Rs 1,000 per month and the company would use the money for purchase of gold on a daily basis and the total accumulate funds can be redeemed for gold coins or jewellery at the end of the investment tenure.
The plan was launched here today in association with the World Gold Council as its marketing partner.
Reliance Money, part of Anil Ambani-led Reliance Group's financial services arm Reliance Capital, said this first-of- its-kind plan would target the unorganised gold market that accounts for 75 percent of total gold sales in the country.
"Gold worth about Rs two lakh crore is sold every year in the country through unorganised market and we are taking on that market with this plan," Reliance Capital's Broking and Distribution Business CEO Vikrant Gugnani told PTI.
Asked what percentage share of this market Reliance Money was eyeing with this plan, Gugnani said: "Right now there is no other player to take on this huge potential through an organised market. We are the only player and would target the entire market, but we are sure some others would later come in".
The customers would be levied an administration charge of 1.5 percent on each subscription, while there would be a 2.5 percent pre-maturity charge as well.
As per the World Gold Council, 986 tonnes gold, valued at about Rs 3.2 lakh crore at current price, is estimated to have been sold in the country in 2011. Out of this, about 75 per cent gold is sold through unorganised market, with rural and urban market almost evenly divided.
Reliance Money said claimed the new plan is different from schemes offered by unorganised jewellers which only allowed consumers to buy gold at prices prevalent at the end of the tenure.
"Reliance My Gold Plan will change the way consumers accumulate gold and we expect it to be the most preferred way of saving in gold," Gugnani said.
He said purity was one of the biggest concerns today and just about 10,000 out of a total of one million jewellers in the country sold hallmark-approved products.
"We will ensure that the customers get pure gold," he said, adding Reliance Money has already tied up with 100 approved jewellers for the plan and soon it would expand its network to more than 10,000 locations in next few months.
The customers can opt for tenures ranging from one year to 15 years and the plan's daily average pricing methodology splits the monthly subscription into equal parts and allots gold grams over 20 successive business days.
At the end of the selected term of the plan, customers have the option to exchange their accumulated gold grams into 24 Karat gold coins or jewellery at designated outlets.
First Published: Thursday, November 22, 2012, 14:39