Digital Gold Price

Gold prices have been soaring ever since the COVID-19 outbreak that started in 2020. This resulted in an increasing number of investors investing in gold. More and more individuals are becoming familiar with the different forms of gold investment. If you wish to invest in gold, you should be well versed with its investment options and benefits.

Before investing in gold, it is important to evaluate the aim of the investment. For instance, if you are seeking ornaments, you should invest in purchasing gold jewellery. However, if your purpose of investing in gold is getting higher returns and profit, digital gold is the right option for you. This guide will give you a clear understanding of digital gold and whether or not it is a good investment.

What is Digital Gold

Digital gold, a new age investment instrument, is a virtual way of investing in 24 carat 99.9% pure gold that does not require actual possession of the commodity. You can invest in digital gold online through UPI transactions as well as internet banking. Following the online payment, the seller will provide a digital invoice for the aforementioned transaction in a span of five minutes.

When you buy digital gold, the company stores it in its safe vault and thus, the risk of theft is eliminated. When it comes to physical gold, there is no guarantee of purity if you buy gold jewellery that is not hallmarked. This is not a matter of concern in the case of digital gold because it is certified by government-licensed entities.

Advantages of Investing in Digital Gold

The advantages of investing in digital gold are as follows:

  • Digital gold investment amounts can be as small as Re.1.
  • You can sell or buy digital gold from the comfort of your home.
  • Unlike physical gold, digital gold offers instant liquidity without any hassle.
  • You can use it as collateral for online loans.
  • Digital gold is fully insured and stored safely.
  • It can be exchanged for physical gold such as gold jewellery, gold coins, and bullion.

Disadvantages of Investing in Digital Gold

The disadvantages of investing in digital gold are as follows:

  • A GST of 3% will be levied on digital gold.
  • Companies provide a limited storage period, after which digital gold has to be delivered physically or sold.
  • Capital gain tax is added when selling digital gold. If the investment or holding period is less than 36 months, it will be subject to the Short-Term Capital Gains (STCG) tax, under 'Income from Other Sources,' and taxed at the buyer's income tax bracket. If held for more than 36 months, it will be subject to the Long-Term Capital Gains (LTCG) tax of 20% (with indexation benefit), plus cess and surcharge.
  • Most platforms have a limit of Rs.2 lakh for digital gold investment.
  • There is no government-run regulating body like the Securities and Exchange Board of India (SEBI) or the Reserve Bank of India (RBI).

Check for more info - GST on Gold

Where to Purchase Digital Gold

You can purchase digital gold via UPI based payment apps such as PhonePe and Google Pay. If you purchase digital gold via Google Pay, it will be stored by MMTC-PAMP with 100% insurance. Furthermore, you can also purchase digital gold from the websites or apps of any of the banks.

Digital gold can be purchased from any app since the app does not sell it. Instead, companies such as Augmont, SafeGold, and MMTC are responsible for storing and selling digital gold. Augmont and SafeGold are private companies whereas MMTC-PAMP is a strategic partnership between India's MMTC (a government of India undertaking) and Switzerland's PAMP SA (bullion brand).

Digital gold can help in diversifying your portfolio during times of inflation and systemic risk. In India, gold rates have risen by 28.2% over the past year. Therefore, if you don’t wish to buy ornaments, investing in digital gold will be the ideal option.

FAQs on Digital Gold Price

  1. Is digital gold a good investment?

    Digital gold is a good investment option if you wish to invest in a good investment option if you wish to invest in gold without possessing it in physical form.

  2. Is digital gold safe?

    Yes. Digital gold is stored in safe vaults and is 100% insured.

  3. What is the maximum limit of investment in digital gold? Most platforms allow you to invest a maximum of Rs.2 lakh in digital gold.

  4. Can I use digital gold as collateral for loans?

    Yes. You can use digital gold as collateral for loans.

  5. Where can I buy digital gold?

    In India, you can buy digital gold from companies such as Augmont, SafeGold, and MMTC-PAMP.

  6. Is GST imposed on digital gold?

    Yes. A GST of 3% is imposed on digital gold.

Read More on Gold

Gold Rate In Metro Cities
Gold Rate In Other Capitals
Gold Rate In Other Major Cities
Gold Rate In States
Bank Gold Schemes

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