Safe, Secure & Seamless Way of Buying Gold Digitally

Akshaya Tritiya, the auspicious day that will be celebrated ahead during this week (Friday, May 14), is the day when Indians buy gold and it is believed as an age-old tradition. Due to the raging pandemic, in the last year, the gold industry has changed dynamically. With traditional gold buying methods being limited, people are now opting for a more flexible buying option- digital gold platforms. 

Ways to Invest in Gold in India?

Well, historically the most common way to invest in gold has been to buy physical gold in the form of coins; bullion, and jewellery. Apart from that, we have sovereign gold bonds, gold mutual funds, and gold ETFs to choose from in digital form. But during a pandemic, another method of investing in gold that has been gaining immense popularity is in the form of digital gold.

What is Digital Gold?

Buying physical gold certainly has its downsides. There are issues of identifying its legitimacy and purity, then there are problems of safekeeping and storage. One more issue is that we are amid a pandemic. It is not quite ideal to go out to gold dealers or jewellery stores.

Digital gold, on the other hand, can be bought online and is stored in insured vaults by the seller on behalf of the customer. It also helps us overcome all the aforementioned issues of physical gold purchases. All you require is internet/mobile banking and you can invest in gold digitally anytime, anywhere.

How to trade in digital gold?

You can easily buy gold online from recognized and trustworthy dealers and through their apps. Once you’re logged in and filled in all the details, perform the following steps –

* Enter the amount you want to spend on buying gold or you can mention the quantity of gold (in grams).

* Choose your payment options from net banking, UPI, credit/debit cards, wallet to a cash payment

* Once the payment is done the account you are using will be credited with the gold in vaults backed by trusteeship services recognized banks and can be accessible 24/7

* By calculating the live market price, you can sell your gold whenever you want and gain profit.

* You can also convert your digital gold into physical form and get it delivered to your doorstep without you going out.

Benefits of Investing in Digital Gold:

* Digital gold can be bought or withdrawn online 24 hours a day, 7 days a week, and 365 days a year. 

* You can take physical delivery of the gold at your doorstep.

* You can invest an amount as low as Re.1.

* Digital gold can be used as collateral for online loans.

* Digital gold is genuine and the purity is 24K 99.5 percent

* Your purchase is stored safely and is also 100 percent insured.

* You can exchange digital gold for physical jewellery or gold coins and bullion.

Disadvantages of Investing in Digital Gold:

* Limit of Rs 2 lakh for investment on most platforms.

* Lack of an official government-run regulating body such as RBI or Sebi.

* Delivery and making charges are further applied to the price of gold.

* In some cases, companies only offer a limited storage period, after which you either have to take physical delivery or sell the gold.

Why should one go for Digital Gold?

Digital Gold, as you know, is the new way of buying gold, below are some reasons why you should go for it. 

* Eliminating Storage & Security Concerns: The best part about digital gold is that you own it and only you know it. You no longer have to worry about getting a bank locker or buying a safe at home to protect your wealth.

* Purity: Buying physical precious metals is safe but if you fear purity then digital gold is still the safest open. 

* Buying/Selling as per your convenience: Time is valuable and online service providers value it the same way you value it. Digital gold can be bought whenever you feel like investing, if you wish to liquidate/sell you can easily do so. 

Can we use DigiGold for gifting?

Absolutely! Simply enter the details of the recipient and the amount of gold that is to be gifted. The recipient does not already have an account then he/she will need to create an account to claim the gift.

Where can you find an invoice for each order?

An invoice will be sent by SMS/Email after each transaction. It will also be available in the My Order’s section on the customer's dashboard.

Where is the Gold stored when a customer purchases it?

The gold purchased by a customer will be stored with a reputed custodian on a consolidated basis ie. daily purchase across all the customers. Vaults are monitored and controlled by IDBI Trusteeship Services Limited. The trustee will confirm the balances with the custodian each quarter and reconcile the amounts with the customer's balances.

The author is is Director, Augmont

 DISCLAIMER: Views expressed are the author’s own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.