The Monetary Authority of Singapore (MAS) announced the launch of a high-security gold vaulting service capable of holding up to 500 tonnes of gold reserves for central banks and international financial institutions. It plans to exempt institutional gold trading transactions from the Goods and Services Tax (GST) to address soaring gold demand amid global economic uncertainties and to establish Singapore as a new regional hub for gold trade and delivery.
The Monetary Authority of Singapore, in collaboration with the Ministry of Finance, officially launched the "Gold Vaulting Service" today (10 Nov) to enable foreign central banks, international financial institutions, and sovereign wealth funds to securely store their gold reserves in Singapore.
Gan Kim Yong, Deputy Prime Minister and Chairman of MAS, revealed that the gold storage service is located within Singapore's National Currency Vault, currently able to accommodate and store up to 500 tonnes of gold, with plans to expand capacity in the future to meet rising demand. This public service will complement Singapore’s private gold vaults, which currently have a combined capacity exceeding 2,000 tonnes, further strengthening the sector.
To promote Singapore as a global gold trading center, MAS and the Ministry of Finance plan to introduce a revised Goods and Services Tax (GST) framework that will exempt GST on wholesale services related to investment gold transactions among institutional market participants. These services include gold vaulting, recycling and refining, purity testing, and brokerage services.
Gan stated that this tax measure reflects the reality that gold in this trading system circulates among financial institutions and is not intended for domestic consumption. The exemption is expected to take effect from April 2027 and will be detailed further in the 2027 annual budget.
Gan emphasized that amid increasing external and geopolitical uncertainties, demand for gold as a safe-haven asset among global investors and central banks has steadily risen to diversify risks. Singapore's service is not intended to compete with or replace established gold trading centers such as London, New York, or Hong Kong, but rather to offer an additional, secure, and stable option for central banks.
Research from DBS Bank indicates that one in four central banks worldwide is evaluating Asian financial centers as official gold reserve storage locations. Meanwhile, global gold demand is projected to exceed 5,000 tonnes in 2025, reaching a historic value of approximately 555 billion US dollars, with Asia accounting for over half of the world’s demand for gold bars and coins.
In addition to launching the gold vault, MAS, along with the Singapore Exchange and six leading commercial banks—DBS, Deutsche Bank, ICBC Standard Bank, JPMorgan, OCBC, and UOB—is accelerating preparations for a clearing and settlement system for over-the-counter gold transactions. This system will cover both standard London Good Delivery bars (400 troy ounces) and 1-kilogram gold bars, aiming for completion by the end of 2026 and service launch in the first quarter of 2027.
Furthermore, the Singapore Exchange plans to introduce physically delivered gold futures contracts in the second quarter of 2027. These initiatives will integrate gold storage, trading, and settlement, enhancing liquidity during Asian market hours and attracting high-value employment in finance and risk management sectors to Singapore over the long term.