How compulsory hallmarking of gold jewellery is affecting customer purchases

It has been fifty days since the government imposed mandatory hallmarking on jewellers with turnover in excess of Rs 40 lakh. This matters to you the next time you visit a jewellery shop to buy gold. Here’s why.

Buy only what you are promised

Hallmarking will ensure that you are paying only for the promised purity of gold.

“Earlier, there were certain jewellers who would sell 18-karat jewellery and charge the customer for 22-karat jewellery by claiming it to be of higher purity. Now, this mandatory hallmarking act will prevent such fraudulent practices,” Cecil de Santa Maria, chief operating officer of ORRA.

Hallmarking could also mean that you would find a tiny part of the jewellery being used for checking, if it requires the fire-assaying method for certification. But you would be paying only for the weight that you get, after such scrappage. This, too, comes certified.

You can assess whether a piece of jewellery is actually hallmarked by checking for the logos. “Three logos are present on the hallmarked jewellery piece – the Bureau of Indian Standards (BIS) logo, purity mark and the six-digit Hallmarking unique ID (HUID). The logo of the jeweller will be missing,” says Surendra Mehta, National Secretary of India Bullion & Jewellers Association.

Higher costs for hallmarked jewellery

The cost of your hallmarked jewellery is bound to go up, experts say. Here’s why.

Nearly 933 laboratories across India have been tasked with hallmarking existing jewellery (at least 5 crore pieces, as per market reports). They are working round the clock to hallmark the jewellery pieces. And they have made investments in their machinery and also increased their insurance covers to protect against themselves against theft and fraud. How does all of this affect you, the consumer?

The additional cost would be passed on to you. Rajiv Popley, director of Popley Group estimates a three-fold increase in the cost of hallmarking. “The labs aren’t accepting jewellery as they have already stocked up to their insurance coverage limit,” he says.

And since jewellers now cannot sell jewellery unless they are hallmarked, they are likely to incur losses. This would further lead to an increase in jewellery cost. “Some jewellery pieces are being cut for testing and leading to loss of partial weight of jewellery,” says Mehta.

Hence don’t be surprised if your jewellery invoice mentions Rs 100 per piece as hallmarking/ certification charge from September instead of Rs 35 per piece currently. “The charge per unit is Rs 35, so a pair of earring would cost Rs 70 more for hallmarking currently,” Popley explains.

No more quick modifications

Prior to June 2021, if you wanted a 24-inch chain to be reduced to 20-inch, an in-house technician could have immediately reduced the length and handed over the jewellery for you to gift or wear to the evening wedding.

“Now the jewellery would have to again go to the laboratory for the weight issue, be certified and only then be handed over to the customer. Immediate alterations would be a thing of the past,” says Dinesh Jain, director of the All India Gem and Jewellery Domestic Council.

So, plan in advance if you seek customised jewellery. “Laboratories have been taking more than 14 days to do hallmarking, which earlier could be done in 24-48 hours,” says Popley.

Can you still be duped?

But just because the mandatory Hallmarking Act has come into effect, it doesn’t mean you can blindly buy jewellery and assume it is pure.

“Under the Act, there is an exemption granted for hallmarking of kundan, jadau and polki jewellery,” confirms Mehta, adding that the same can be voluntarily checked for purity upon the customer’s request.

Also, the mandatory hallmarking is not mandatory for all jewellers. “Despite mandatory hallmarking, it is still possible for people to get non-hallmarked jewellery as the government has made a relaxation for jewellers whose turnover is less than Rs 40 lakhs per annum,” says Santa Maria.

As there are limited numbers of laboratories in the country, hallmarking is mandatory for only 256 districts (out of the 715 districts in India).

Avoid being duped

Mehta says that it’s best to visit only shops that display the BIS logo outside their showrooms, to avoid being duped.

Assess the logos present on your jewellery. “Customers should ask for the hallmark to be visibly imprinted on the piece of jewellery or article they are purchasing. Request for a 10x magnifying glass and you would clearly see the big Hallmark triangle, the caratage mark or the fineness,” Santa Maria suggests.

But would mandatory certification mean you can’t sell your existing non-certified jewellery? “If you wish to sell your old non-hallmarked jewellery, then the same would be accepted as jewellers have been selling non-hallmarked jewellery for many years, melting the pieces and recycling the gold,” says Popley.

So, you can easily sell your non-certified jewellery. Don’t settle for a lower value due to this reason.

Courtesy: Money Control