Hyderabad: There has been a 25 per cent drop in cash transactions in the sale of gold in the one year since demonetisation. Experts say the industry will take several years to recover. Purchases through cheques and digital transactions remain the same.
A member of the Twin City Gold Association told Deccan Chronicle: “A year pre and post note ban shows that the precious metal industry suffered a drop of 25 per cent in cash sales but increase of 5-10 per cent in digital payment (either through cheque or debit/credit card). When the ban on old currency notes was announced, many imm-ediately purchased gold by paying 50 per cent extra per tola. With this, stocks got exhausted. Demonetisation had a repelling effect on the industry countrywide as the appetite for gold was exhausted.”
While buyers have become more cautious, many purchases of mo-re than `2 lakh are still made with split or multiple bills to avoid tax. The gold industry has certainly been challenged by the fall in cash sales and the closer scrutiny of black money. Traders have also lost margin due to high competition and low sales, and are selling gold at a low margin.