Selling or exchanging old jewellery is the transaction where buyers lose the most money, because almost nobody knows how the number is arrived at. It is not complicated. Three things decide it.
1. The fine gold rate
Buyback is always priced from the 24K rate, never the 22K one — because what the shop is buying is the gold content, whatever form it currently takes. Check the gold rate today before you walk in. This part is not negotiable and is the same at every shop in your town.
2. Your actual tested purity
A 22K chain is 91.6% gold, so in principle you are paid 91.6% of the fine rate. In practice the shop tests rather than assumes, because a piece can be lower than its stamp, and solder at the joints is always lower-purity metal.
Three testing methods, in ascending order of accuracy:
- Touchstone — rubbing the piece on a stone and comparing acid reactions. Quick, cheap, and a rough estimate. Fine for a small item; not what you want on a heavy set.
- XRF machine — an X-ray reader that gives a percentage in seconds without damaging the piece. This is the standard now and what you should ask for.
- Fire assay — melting a sample. The most accurate and destructive, used for bulk and by refiners.
Insist the test happens in front of you and that you are shown the reading. A shop confident in its testing will not mind. One that takes your gold into a back room and returns with a number has told you something.
3. The deduction
Refining gold back to a usable form costs money and loses a little metal. A deduction of roughly 2-8% is normal and legitimate. Beyond that you are subsidising someone.
Also deducted, correctly: the weight of stones, enamel, lac filling and any non-gold parts. A kada filled with lac can be a third filler by weight. Ask for gross weight and net gold weight as two separate figures.
Exchange or cash?
Most shops pay a better rate for exchange — where you put the value toward a new piece — than for a straight cash sale, often 3-5% better, because they keep you as a customer. If you are buying something anyway, exchange. If you need the money, expect the lower number and shop the quote around.
The part that hurts
You do not get making charges back. Ever. If you paid 20% making on a bridal set, that 20% is gone the day you bought it. This is the single biggest reason heavy, intricate jewellery is a poor way to hold value, and why coins and bars are a better one.
Hallmarked pieces are easier
A piece carrying a BIS hallmark and HUID has a certified purity, which removes most of the argument — the buyer can verify it rather than estimate it. How to read and check the hallmark takes a minute and is worth doing before you sell, not after.
A short checklist
- Check the day's 24K rate before you go.
- Ask for XRF testing, watch it, and see the reading.
- Ask for gross weight, stone weight and net gold weight separately.
- Ask what the deduction percentage is, as a number.
- Get the same three answers from a second shop. The rate will match; the deduction will not.