Review: Tanishq Swarnanidhi Scheme

Two months back I went to one of the boutiques of Tanishq to redeem my subscription of Golden Harvest Scheme. Before I precede further let me share my experience while redeeming,

Representatives were very polite and extended every help possible for a smooth transaction. They had all my details before hand which was necessary to complete the transaction all they asked me was my proof of identification which was given at the time of enrolling and rest was taken care by them.

While checking out I was introduced with their another offering Swarnanidhi which is basically a plan for 12 months in which the subscriber can lock gold (weight) at a price on a particular day and can redeem the same value of gold at the end of 12 months irrespective of the price of gold at time of redemption.

However unlike Golden Harvest Scheme there is no additional bonus is being offered except discount on making charges which I guess is around 10% – 20% only if the subscriber pays on regular basis.
Subscriber in this scheme has to make at least one payment per month which should be minimum INR 2,000 and there is no limit for maximum amount and can make any number of payments within a month.

Redemption under this scheme can be done as:-

  • Value the grams on the day of redemption; for example during the term subscriber has locked 100 grams of gold and price at the end of the term is INR 45,000 (hoping so seeing the pace of movement of gold) then value of gold would be INR 45,000 x 10 = INR 4,50,000. In this case subscriber can buy gold worth INR 4, 50,000 (mindboggling)

There are few pointers which I would like to mention about this scheme:-

  • Subscriber can only purchase gold and diamond ornaments, no purchase of coins is allowed.
  • There is no online option unlike for Golden Harvest Scheme. Only NEFT transfer is possible if we speak about online payments.
  • The scheme is offered at boutiques of Tanishq any change request has to be routed thru these boutiques only.
  • Definition of month is date of enrollment + 30 days for example my enrollment date was 22 September 2013 therefore my monthly cycle will be 22 – 21 of every month.
  • Subscriber will lose the discount on making charges if the payments are not made on monthly basis.
  • This is a well-known fact; gold rates of Tanishq are way more different than market rates.
  • If subscriber makes an online NEFT transfer than for payments realized before 1400 hours todays gold rate will be applied and after 1400 hours tomorrows rate.
  • Subscriber will receive an email copy of receipt in case of an online transfer.
  • Subscriber can make unlimited payments within a month.
  • No detailed explanation of the scheme on their official website.

How subscriber will benefit out of it:-

  • Instead of saving money to buy gold on a later day where the prices are dynamic in nature, subscriber is actually locking the price of gold.
  • Flexibility of allocation of money as there is no present fixed amount to be paid.
  • Opportunity to access world class designs and trust of Tanishq
  • If subscriber has a good relation with boutique then in some cases redemption can be done earlier.
  • Early exit is also possible in case subscriber is not able to pay any future installments.
  • Easy access to their online chat tool and toll-free number in case subscriber would like to know the price of gold.

Tanishq Chat Tool

How Tanishq is making money:-

  • Company is getting cash today for purchases that are to be made in future.
  • Being a big corporation they can play with the fluctuations in gold prices.
  • Mitigating from demand risk
  • Margins are already included in daily gold rate.
  • Increasing loyalty

If you ask me about this scheme I will again say this is not for investment purposes wherein the investor can expect good returns over a period of time. This scheme is for those who are looking to purchase gold after a period of time or people saving money to purchase gold on a special occasion. I believe this will be helpful for those who often tend to forget some important dates and later regret it ( I know many of you got me, we all belong to Seagram’s Imperial Blue cadre).