The Ministry of Industry, Mine and Trade in collaboration with the relevant unions will soon start issuing license for gold trade on the internet.
According to Alireza Shahmirzaei, a deputy minister, the aim is to replace unauthorized trade, as is taking place in social media platforms, with authorized websites that will be licensed soon, Tasnim news agency quoted Shahmirzaei as saying.
On concerns over legalizing online trading of the yellow metal, the official said, “The concerns must be studied in detail. Yes, they [opponents] do say that they are worried about people’s money, but their real intention could be something else.”
He went on to say that “It is not wise to ban online trade of gold merely because of some small fraud cases. Issuing guarantees is the solution to the problem.”
Online gold trading platforms would be able to gain public trust when banks and other financial institutions guarantee their operations, he noted.
As per law, banks are barred from trading in gold, but there are no regulations prohibiting lenders from issuing guarantees for bullion gold.
The official criticized trade unions related to the gold market for opposing the legalization of online trade in the past, saying that the government is determined to stop this trend and legalize online gold trade.
In related news, Mohammad Vali, head of the Tehran Gold and Jewelry Union, said legalizing online gold trade is premature for now simply because the infrastructure for such business in not in place.
“We believe that permission for selling gold online must be given only to those who own a shop and can be referred to if a problem arises,” Mehr News Agency quoted him as saying.
Unofficial online gold trade jumped after the outbreak of the Covid-19 and closure of markets. In 2021, Mohammad Kashti-Aray, vice president of the Tehran Gold and Jewelry Union, said some 2,500 jewelers were operating online in the capital alone. "They have no permit to operate either virtually or in the physical gold market," he said.
Kashti-Aray said the TGJU has banned online gold trade because the risks are high. "There is no supervision over online gold deals. Sellers usually don’t issue invoice and there is no transparency. So far as the union is concerned, such deals are not allowed.”
Almost 3,000 jewelers are officially allowed to sell gold in Tehran's bullion market of which 500 also operate online. Iran is among world’s top consumer of gold and jewelry
According to World Gold Council, in the first quarter of 2022, jewelry demand in the Middle East extended its recovery from the pandemic-induced slump of 2020, reaching its highest level since the first quarter of 2019. Regional demand was 18% higher at 47 tons, with the UAE and Iran contributing most to the demand growth. According to the WGC, demand in Iran was 41% higher at 8.4 tones.
