The standard hallmark, introduced to guarantee gold purity, is losing its reliability as market pressures mount. High gold prices and slowing demand have intensified competition, driving hallmarking operators—particularly in smaller cities and towns across northern India—to adopt illicit practices to secure higher volumes from jewelers.

Unscrupulous hallmarking centers are compromising the purity of gold jewelry in India through code tampering and illegal commission schemes, according to industry sources and officials.

Industry sources revealed that operators manipulate the system by assigning a single six-character alphanumeric Hallmark Unique Identification (HUID) code to multiple jewelry pieces of identical design. In some instances, centers have issued 22-karat purity certificates for 20-karat gold.

Although official hallmarking fees were recently raised from 45 rupees to 75 rupees per piece—the first increase in nearly five years to offset rising machinery and operating costs—many centers undercut these rates or pay kickbacks to manufacturers and wholesalers in exchange for bulk orders.

While manufacturers, wholesalers, and center operators benefit financially from the discounted arrangements, industry experts warn that end consumers are left paying for substandard gold.