Muthoot Exim, the precious metals division of Muthoot Pappachen Group, the leading gold financing company in the country, has announced its decision to foray into retail gold recycling business.
The company plans to launch a series of ‘Muthoot Gold Point’ retail outlets, the first of which was opened in Coimbatore on Monday. Three retail outlets will be launched in South India during this financial year. The outlets will handle direct purchase of scrap, old and used gold items from customers. The gold thus collected will be reprocessed and refined and subsequently be used towards domestic consumption.
According to the company, it has already tied up with Mumbai-based Infinium Precious Resources to carry out scrap gold refining operations.
The company aims to make productive use of unused gold assets with customers, thereby reducing the dependence of jewelry sector on gold imports. As per rough estimates, 25,000 tonnes of gold are lying idle with Indian households and temples. However, only around 200 to 300 tonnes of idle gold is recycled every year.
In India, recycling of huge quantities of institutional gold is being carried out by banks. The retail gold recycling business is presently dominated by smaller retail players. Muthoot’s entry into the gold recycling is expected to bring more transparency into scrap gold recycling business in the country.