How to read a gold buying quote, line by line
Gross weight, net weight, tested purity, rate and payout: what each line of a gold buying quote means, with an illustrative example and questions to ask.
By Value Money Gold, Kurnool · Updated
A fair quote is more than one number. It shows how the number was reached, so you can check it and compare it with another buyer. Here is what each line should tell you.
The lines on a gold quote
| Line | What it tells you |
|---|---|
| Gross weight | Everything on the scale: gold, stones, beads and any filling. |
| Stone and non-gold weight | What is taken off because it is not gold. |
| Net weight | Gross weight minus non-gold weight. This is the gold being priced. |
| Tested purity | The purity found by testing, such as 916 (22K) or a reading like 91.2%. This, not the stamp, is used. |
| Rate | The rate per gram used, and whether it is a 24K (999) or a 22K (916) rate. |
| Gold value | Net weight, purity and rate multiplied together, with purity applied once. |
| Other deductions | Any charge, named and in rupees. |
| Loan settlement | For pledged gold only: the amount paid to close your loan. |
| Payout | What you receive, and how it is paid. |
An illustrative quote
Made-up round numbers to show the arithmetic. This is not a real customer, today’s rate or our buying rate.
| Line | Figure |
|---|---|
| Gross weight | 21.40 g |
| Stones and non-gold weight | 1.40 g |
| Net weight | 20.00 g |
| Tested purity | 916 (22K) |
| Rate used | ₹9,800 per gram of 24K (999) gold |
| Gold value | 20.00 × 916 ÷ 999 × 9,800 ≈ ₹1,79,716 |
| Other deductions | None |
| Payout | ₹1,79,716, by UPI or in cash, as it is under ₹2 lakh |
Watch for purity taken off twice
A 22K rate already prices 22K gold. If a quote multiplies the net weight by 0.916 and then by a 22K rate, purity has been taken off twice and the price is about 8% too low.
Purity should be applied once: either net weight × the 22K rate, or net weight × (purity ÷ 999) × the 24K rate. Both give nearly the same answer.
Reference rate, quote and payout are different numbers
- Reference rate: a published market rate, such as the IBJA rate. It is a starting point, not an offer.
- Buying quote: what a buyer offers for your tested gold at their buying rate for the day. It is usually below the reference rate.
- Payout: the quote you accept, minus the loan settlement if the gold was pledged.
Questions to ask about any quote
- Which rate did you use, and is it a 24K or a 22K rate?
- What was the gross weight, and how much was taken off for stones?
- What purity did the test show, and can I see the reading?
- Is there any other charge? How much, in rupees?
- Can I have these figures to compare with another buyer?
At Value Money Gold
Testing and weighing happen in front of you, every figure on this list is shown to you before you decide, and you are free to take our figures to another buyer.