Consumer VOICE

Hallmarking of Gold

Hallmarking of Gold
Why You Must Look for It

Gold is a precious metal held dear across the world. It is a wonderful ornament to wear as well as a hedge against inflation and falling markets. Gold can also be liquidated easily. However, it is relatively easy for the customer to be a victim of irregular metal quality. A buyer, for instance, will be told that he has bought gold of 22 carats. When he goes to sell or exchange it, he discovers that the gold is actually only of 18 carats. This is why it is important to grasp the relevance of hallmarking. A hallmark indicates that the gold in the jewellery adheres to international standards of purity. The percentage of purity is all that matters since the price that you pay hinges on it.

Among unscrupulous manufacturers and suppliers, there has been a tendency to deceive the common consumer by supplying gold of lower cartage than declared. The convenience of gold alloying with less precious metals – silver or base metals like copper and nickel – has made the process easier for jewellers and the cumulative value of such forgery is estimated to run into thousands of crores of rupees in India. It is easy to perpetrate because with gold a considerable amount of alloy can be introduced without changing the colour. Unless alloyed with a comparatively small proportion of some other metal, pure gold is too soft to withstand wear as an article for use or adornment.

This lacuna has demanded that some system of control be in place if frauds on the public are to be prevented. In England the formal assaying of gold started in 1478, when it was made compulsory for jewellers to get their gold wares assayed. The measures adopted then for assaying the jewellery and gold articles and marking the purity over them gave rise to hallmarking.

It is estimated that there are nearly 100,000 gold-manufacturing units throughout India, mostly employing up to 10 workers. There are about 100 large mechanized factories employing up to several hundred workers. There is an abundance of cheap skilled labour. Because the traditional jewellery is almost totally handmade, the workforce is large and totals about two million. Many of these artisans have been trained in jewellery-making skills from the age of 10 years and they lack formal education. Many manufacturers and retailers sub-contract work to small workshops and this makes gold stock control and caratage quality control difficult to achieve.

Hallmarking in the context of gold has been defined as the accurate determination and official recording of the proportionate content of precious metal in gold wares. Hallmark is a guarantee of purity or fineness.

Handcrafted jewellery is made using traditional tools and working practices. Melting and alloying is done using charcoal or coke-fired furnaces. Soldering operations are done using a mouth blowpipe with a candle or oil flame. Many small workshops buy scrap which they sometimes reuse without refining, while others refine it themselves using old and crude technology.

The oldest types of fraud are those of adulteration by addition of too much low-cost alloy. The traditional handcrafted pieces in 22 carat contain many solder joints and the use of solder alloys of a much lower caratage has meant a serious level of under-carating. These frauds continue till today and can be stopped by increasing awareness and encouraging consumers to purchase only hallmarked jewellery

BIS Hallmarking Scheme

In India, Bureau of Indian Standards (BIS) is the accreditation agency that certifies and hallmarks gold jewellery and other precious metals. The hallmarking scheme is voluntary in nature and serves to:

protect the consumer against the purchase of gold jewellery with lesser purity than declared;
provide third-party assurance to the consumer of declared purity;
develop export-competitiveness; and
make India a leading gold market centre in the world.

In January 1999, the Reserve Bank of India (RBI) standing committee on gold and precious metals identified Bureau of Indian Standards (BIS) as the sole agency to operate the hallmarking scheme in India. After indepth study of national and international practices, BIS launched the hallmarking scheme of gold jewellery on 11 April 2000.

Standardization on gold basically starts with grading of gold depending upon its purity. So, the value of gold can be fixed according to its grade. The standards lay down the fineness in terms of numbers by weight of gold in thousand parts by weight of the alloy.

Purity is also expressed in terms of carats. For instance, 24 carat, or 24k, indicates the purest form of gold – that is, the gold content is 100 per cent. However, pure gold is too soft to use it as jewellery. So it is alloyed with a mixture of metals like silver, copper, nickel and zinc to give it strength and durability. In percentage terms, 18k would mean 75 per cent purity (denoted by 750) and 22k would mean 91.6 per cent (denoted by 916) purity.

As per the scheme, the BIS license is granted to a jewellery/jewellery manufacturer (as per IS 1417) and recognition is granted to an assaying and hallmarking centre on the basis of compliance with IS 15820:2009 and IS 1418: 2009. Licensed jewellers can get their jewellery/artefacts hallmarked from any BIS-recognized assaying and hallmarking centre on payment of Rs 25 per article. The hallmarking centre tests the article for the declared fineness (purity) by the jeweller. No negative tolerance is permitted on fineness. As per the standard, gold alloys including solders for manufacturing jewellery/artefacts have to be free from cadmium, iridium and ruthenium. If the fineness is found as per declaration, the jewellery is hallmarked with the help of a laser machine.

What Makes the Hallmark?

Before purchasing gold ornaments, one must check the following components of hallmark through a magnifying glass (magnification 10X) available with the jeweller:
a) BIS logo
b) Purity grade/Fineness
c) Assay centre’s mark
d) Jeweller’s mark
e) Year of marking denoted by a letter symbol (‘A’ denotes the year 2000, ‘B’ 2001, ‘C’ 2002, and so on)

Since launch of the scheme, over 10,000 gold jewellers have taken license from BIS and so far about 500 lakh jewellery articles have been hallmarked. The list of BIS licensee jewellers and recognized hallmarking centres is on the BIS website (www.bis. org.in). In case the purity of hallmarked jewellery is found to be less than that declared by the jeweller, a customer may file a complaint in any BIS office in India.

Suppose you have checked the hallmark components but are still doubtful of the gold’s authenticity. You can go to an authorized assaying and hallmarking centre and get the gold tested. If your doubt is validated and the gold’s purity is less than what is marked, the charges will be refunded. Your jeweller will also have to provide a replacement.

At the time of purchase, do insist on an invoice that mentions the carat clearly. The bill should also mention the date of purchase, the weight of the gold, the making charge and the value-added tax.

The BIS also carries out random checks from time to time on the certified jewellers. Differences in marked and actual purities can lead to cancellation of the license.

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