Gold Leasing: There has been a strong rise in the prices of gold for the last several months. According to the report of Times of India, in the week of November 14, spot gold had fallen by 2.64% in the last two trading days due to the uncertainty of Fed rate cut, yet if we look at the entire week, it closed at $ 4,084 with a gain of about 2%.
After the rise in the price of gold, many big funds, investors and owners of big companies around the world are earning huge income every year by renting out gold bars (gold which they do not use – idle). This is called gold leasing. Gold leasing means that you lend your gold, which is not in use right now, to jewelers, refineries or big financial platforms for a few months or weeks. In return, you can get returns ranging from 1 to 7 percent every year. You can get this money in cash, in grams of gold or in the form of interest. The best thing is that you remain the owner of the gold. If the price of gold increases, you get the full benefit and on top of that, you earn a separate rent every year.
Where in the world does gold leasing take place?
London’s OTC market, LBMA and America’s COMEX are the biggest centres. These places are considered global hubs of gold leasing. Here big investors and institutions carry out this work. Now this trend is increasing rapidly in India also. Digital platforms like RSBL, Gullak Gold, many big jewelers and government gold monetization scheme are working in this manner. You can also deposit your gold bar, coin or old jewelery with them and get good returns every year.
Why is this trend increasing?
Gold in itself does not give any income. It is called non-yielding asset in English. Earlier, rich people used to keep gold worth crores in the safe, but now when the same gold is given on rent, they can earn 6-7 percent annually from it, so people get more benefits from this than by selling it. On the other hand, jewelers and refinery people need gold all the time. Taking a loan from a bank is expensive, but gold taken on lease is cheap and readily available. Therefore demand has increased a lot from both sides.
Especially in India, in the last few months the leasing rate has directly increased from 2-3 percent to 6-7 percent. Due to the festive season, weddings and severe shortage of supply, the price of gold is also increasing. New gold mines are decreasing all over the world, old gold is being recycled and in such a situation, the gold which was earlier lying in the safe, is now available in the market. Digital gold apps and gold monetization scheme have made this facility accessible to the common man. Earlier only big people could do this, now even a person having 10-20 grams of gold can earn some extra income every month or year.
Is gold lining safe?
On most platforms the gold remains in your name. Good companies also provide insurance and follow the entire legal process. This is the perfect way for those who want to keep gold for a long time and do not want to sell it. This will neither benefit from rising prices nor will the rental income stop every year.
Gold is no longer just for weddings and emergencies. Now it has become a earning property. If you also have some gold lying around which is not in use, you can give it on rent. With this you can earn good income every year.
