FRIDAY, March 29, 2024
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Gold shops suffer lack of cash as people rush to sell their jewellery

Gold shops suffer lack of cash as people rush to sell their jewellery

Gold shops have been hit by a cash crunch as people rush to sell their jewellery and ornaments, said Gold Traders Association president Jitti Tangsitphakdi.

“The rising gold price in the global market, which has reached a new high in seven years, has caused people to sell their gold for profit,” he said. “Besides, international traders have not been able to export their gold due to a shutdown of airlines and overseas markets, causing many traders to suffer from a cash-flow problem.”
Jitti said some gold traders are looking into short-term solutions, one of which is getting loans from banks.
“However, during this Covid-19 crisis, most banks have nearly reached their limit on loans, while a lack of cash liquidity has forced many traders to repay loans late, making it harder for them to get additional funding. Eventually, some gold shops will have to temporarily shut or ask customers to receive their money at a later date,” he said.
“We have suggested to more than 2,000 gold shops under our association that one measure is to go in for alternate-day opening between shops to slow down the number of people selling gold while preserving their customer base,” he added. “It is also a good way to reduce crowding at these shops to prevent Covid-19 from spreading.”
Meanwhile, Kritrat Hirunyasiri, chairman of MTS Gold Group, one of the biggest gold exporters in the country, said his company has been affected by the cancellation of flights to export destinations such as Singapore, Australia and New Zealand.
“Cash flow has become tighter, causing the company to delay paying gold sellers by 7-15 days,” he said. “However, we estimate that the situation will improve in May as factories in Singapore and Australia are expected to resume operations, so export routes to these countries should also be restored.”

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