The Department of Commerce and Supply Management (DoCSM) has said it will carry out cross-checks on gold transactions made by traders and commercial banks.

The move is aimed discouraging smuggling of the yellow metal.

Amid complaints the banks were not maintaining uniform price, the department on Friday cross-checked the pricing maintained by Nepal Investment Bank and Bank of Kathmandu.

Nepal Investment Bank was found selling gold at Rs4,298,000-Rs4,306,200 per kg, while Bank of Kathmandu sold the metal at the rate of Rs4,295,000 per kg.

The department is scheduled to hold talks with the banks over the price difference on Tuesday. “We will take action against the banks if proven guilty,” said DoCSM Director Hari Narayan Belbase.

Based on a complaint lodged by a Banepa-based jewellery trader, the department had cross-checked the banks.

However, a senior official of Nepal Investment Bank said the prices maintained by different banks may differ as each bank bears different costs while importing. “Gold price changes every second. Insurance cost and freight charge may differ, affecting the costing,” said the official.

Nepal Rastra Bank (NRB) has only allowed commercial banks to import gold at bigger scales, while migrant workers can bring the precious metal in small quantities.

Since last month, the central bank has increased the gold import quota for banks to 20kg a day from 15kg.

Belbase said the department will also look into the prevalence of smuggled gold in the market. “We will cross-match the banks’ records with turnover and inventory with the traders’ records,” said Belbase.

Last fiscal year, smuggled gold largely fulfilled the market demand as commercial banks struggled to sell their stocks. The situation was such that the banks did not even import gold for a few months.

However, bankers say the demand has risen significantly since the government slashed the customs duty by Rs1,000 per 10 gram through the budget for this fiscal year.

Last year, gold imports remained less than 3kg a month for five peak months of wedding and festive season, when the market demand stood at around 25 kg a day, according to the Department of Customs.

However, the very low imports through formal channel showed the prevalence of smuggled gold in the market.