(Reuters) -The World Gold Council in collaboration with law firm Linklaters and consultancy firm Hilltop Walk Consulting has announced a new framework to modernize the global gold market.

The proposal introduces a new structure called Pooled Gold Interests which allows investors to own a share of physical gold stored in vaults, including in small, fractional amounts.

The system is designed to make gold easier to trade and use, including as collateral in financial markets and allow easy and secure transfer of gold interests between parties.

Currently, gold is traded either as allocated gold, gold which involves direct ownership of specific physical bars but is operationally complex, or unallocated gold, which has higher liquidity and lower costs but may expose investors to the credit risk of the institution where the account is held.

The move follows industry consultations and builds on recent reviews by the Financial Markets Standards Board.