With banks and credit institutions banned from accepting gold deposits and offering gold-keeping services as of the end of last month, many gold businesses are running programs in which customers will receive interest if they deposit their precious metal at these entities.

All banks were asked to settle their gold savings with customers by June 30, under an order from the State Bank of Vietnam to better manage and stabilize the market.

The ban left a number of gold holders guessing as to where to keep their precious metal, while enabling some gold traders to make use of the chance to launch gold depositing services.

Vinh, a District 3 resident, said after hearing about the gold savings offered by several gold businesses, his family has considered choosing a reputable facility to send their gold to.

But as the news spread, such companies, fearing intervention by the central bank, said they were temporarily closing the services to wait for further directives from superiors.

The Doji Gold and Gems Group, for instance, used to boast that it would pay annual interest of 1.2 percent for one-month gold deposits, and 1.9 percent a year for gold savings with a term of 12 months.

But when a Tuoi Tre reporter disguised as a customer contacted the company on Tuesday, an employee said the service has been suspended, pending a new directive.

Earlier, another employee revealed that the company has received certain deposits of four to five gold bullions each.

A private gold business in District 6, meanwhile, said it is willing to accept gold deposits, but will pay no interest for the lenders.

The customers will receive a receipt when depositing their gold, and can ask to withdraw the metal anytime they wish, the firm said.

Tran Thanh Hai, CEO of the Vietnam Gold Business, said even though many businesses deny accepting gold deposits, some are still secretly mobilizing gold via this channel, thanks to huge demand from gold holders following the central bank’s ban.

The CEO of another gold company said mobilizing gold from the public is a good way for businesses to have cheap capital for their operations at a time when they are banned from borrowing gold loans from banks, while the interest rates for loans in dong remain too high.

Big risk

Many analysts say depositing gold at these businesses will only pose risks for gold holders.

Lawyer Tran Xoa, for instance, said: “Technically speaking, when a business accepts gold deposit from a customer, it is borrowing gold from that depositor without having to mortgage any collateral.”

“Hence, when the business goes bankrupt or incurs losses, it is very likely that the depositor will lose their gold savings, as the company will be unable to repay the loan,” he added, while suggesting that gold holders consider carefully before sending their yellow metal to these facilities.

The CEO of a gold company in HCMC also said depositors will face high risks as their transactions with gold businesses are not legally recognized, and no one knows what the companies will do with their gold.