Digital Gold Investment: The Future of Investing

For us Indians, gold is one of the most precious metals. It is our go-to investment when we have excess cash. Moreover, every auspicious occasion is marked with the purchase of gold. But with gold prices skyrocketing every day, it is going out of reach for the common man. Even after saving money for months, it is getting difficult to buy gold.

However, this problem is solved with digital gold. With digital gold, you can start investing with an amount as low as Rs 10. The best part is that you can exchange digital gold for physical gold at any time. Read to find out more about how to redeem digital gold investments.

What Is Digital Gold Investment?

Digital gold is an alternative to investing in physical gold. It is backed by the purest form of gold (24 karats) and can be purchased for an amount as low as Rs 10. With digital gold, you need not worry about the purity, storage, or risk of theft. Every time you purchase digital gold, an equivalent weight of gold is stored in safe vaults.

By investing a small amount regularly in digital gold, you can accumulate more gold. You can either sell it instantly or even take physical delivery against it in the form of coins or bars.

Only three companies are authorized to sell digital gold in India. They are MMTC-PAMP India, Augmont Gold and Digital Gold India. These three companies sell gold directly or indirectly through partners such as Gpay, PayTM, PhonePay, etc.

Where to Buy Digital Gold?

Investing in digital gold is just like buying physical gold. When you buy digital gold, you will get it at the current market price. Instead of getting physical gold, you will receive an order confirmation from the platform you bought gold. In the backend, the equivalent weight of gold is stored in a high-safety vault.

You can buy gold from any of the third parties, such as Jupiter Money, Gpay, Paytm, or Phone Pay. All you have to do is enter the amount in Rupees and buy the gold by transferring the equivalent amount. Within seconds, your vault will be credited with gold.

The vault will display the value of the gold you hold. Hence you can check how much your investment has appreciated at any time.

How to Sell Digital Gold?

You can sell digital gold within seconds, as gold is one of the most liquid investments. The platforms that you buy gold on have a sell option that will help you sell gold at any time of the day. You must enter the value in Rupees and click on sell to sell your gold. Upon selling your gold, an equivalent value in Rupees gets credited into your bank account.

How to Exchange or Redeem Digital Gold?

If you do not wish to sell gold, you can redeem it or exchange it for physical gold. Only a few apps allow you to redeem your digital gold investment. To redeem your digital gold, you must follow the steps below:

1. First, enter the value in gold you wish to redeem.
2. Select the type of gold you want. It is either coins or bars.
3. Enter the address where you want to get the gold delivered.
4. Pay the delivery charges to get the gold in physical form. It can take up to a week to get physical gold delivered to your doorstep.

What Are the Advantages of Digital Gold Investment?

Investing in digital gold is far better than investing in physical gold. Following are some of the reasons why digital gold is gaining popularity:

• 24K purity: Digital gold is backed by the purest form of gold. It is 24 karats with 99.99% purity. Hence you need not worry about the quality of the gold.
• Low investment: You can start investing with an amount as low as Rs 10. Hence you need not accumulate a huge amount to invest in digital gold.
• Safety: When you invest in digital gold, physical gold of the same weight is stored in secure vaults. These vaults are very secure and safe, so you need not worry about safety.
• Sell anytime: You can sell digital gold anytime, as gold has high liquidity. The best part is that you can receive money immediately in your bank account.
• Convert to physical gold anytime: Many apps allow you to convert digital gold into physical gold in the form of coins, bars, or jewellery.
• No bias in price: Digital gold is regulated by the Securities and Exchange Board of India (SEBI), and the gold price is decided by the market demand and supply. Hence there is no bias in the price of gold, and it is the same throughout India.

Frequently Asked Questions

1. Can we convert digital gold to cash?
   Yes, you can convert digital gold into money by selling it. Once you sell your digital gold investment, the equivalent value in rupees is credited into your bank account.
2. Can I convert digital gold to physical gold?
   Digital gold can be converted into physical gold. You can take coins, bars, or jewellery against your digital gold investment. However, very few apps allow such conversion.
3. Can I sell digital gold instantly?
   Digital gold can be sold instantly at any time of the day at the current market price. This is because gold ranks high on liquidity and is universally accepted.
4. Can I transfer digital gold?
   Unlike physical gold, digital gold cannot be transferred. You can gift the digital gold to anyone, but transferring the digital gold you own is not possible.
5. Is it better to buy physical or digital gold?
   Physical and digital gold have their own pros and cons. If you want to invest in gold for consumption, physical gold is a better alternative. However, if you wish to invest in gold to diversify your portfolio, digital gold is better.
6. Is buying digital gold taxable?
   GST on digital gold, just like physical gold, is subject to a goods and service tax (GST) of 3%. This is not included in the price displayed on your screen. Moreover, some platforms also charge you for storage and insurance. Hence if you invest Rs 1,000 in digital gold, you will only receive gold worth Rs 970.