The Bombay Stock Exchange (BSE) has launched Electronic Gold Receipt (EGR) on its platform. This announcement comes after it received final approval from the Securities and Exchange Board of India (Sebi) in February for introducing EGR on its platform.
BSE has introduced two new products of 995 and 999 purity during the Muhurat trading on the auspicious occasion of Diwali. According to the exchange, trading will be in multiples of one gram and deliveries in multiples of 10 gram and 100 grams.
"The launch of EGRs represents a significant milestone not only for the BSE but also for the global bullion industry. BSE is committed to continuously facilitating access to high-quality investment-based products and services for our stakeholders," Sameer Patil, CBO at BSE said on Monday.
EGRs will cater to all market participants, which means that buyers and sellers on the exchange will include individual investors as well as commercial participants. The exchange hopes that the EGR platform will lead to greater assurance in the quality due to better transparency.
India is the second largest consumer of gold globally with annual gold demand of approximately 800-900 tonne. The country has remained a price-taker in the global markets and does not play any significant role in influencing the price-setting for the yellow metal. This move is expected to change India's role as the price setter.
The launch comes after BSE conducted several mock trading in the test environment.
-With inputs from Reuters
