The yellow metal, Gold has always been the most preferred investment option for Indians. Over the years, people have traditionally invested in physical gold, through gold bars and gold coins. With such investments, they encounter myriad challenges such as the safekeeping of gold. Apart from that, there are some limitations such as difficulty in physical transportation to quickly respond to price fluctuations.
Removing such worries, an extremely safe and secure gold investment method, Digital gold has gained popularity in the last few years. Due to the expansion of the digital revolution to the gold market, this new form of investment came into existence and has witnessed increased interest from investors. Today, this has become one of the smartest ways to own gold.
What is digital gold?
This is an instrument that allows you to purchase and sell pure gold in digital form at the current market price. The gold you purchase is backed by physical gold stored in a certified vault. When you purchase digital gold, you get an invoice and can see the purchased quantity in your account with the service provider. You can convert digital gold into physical ones anytime such as coins, jewellery, etc. Also, you can sell your digital gold anytime at the prevailing market price.
Today, many firms in India have tied up with service providers like Google Pay, PayTM and others to make digital gold transactions easier and more convenient. You can open a digital gold account with the refiner or through any partner platform.
What are the advantages of holding digital gold?
Digital gold offers many advantages over physical gold that make it the most effective gold investment. Here are some key benefits that will help you make a quick investment decision.
- High liquidity- It is one of the most attractive features of digital gold. You can convert it into cash with a few clicks as per your needs and requirements. This happens because the sale and purchase of digital gold is easier than the physical ones.
- Flexible entry and exit- Investment in digital gold is quite convenient which makes entry and exit flexible and easier. You can open an investment account easily with sellers or partner platforms and enter the market with a small amount. At the same time, as per your will, you can sell your holding and exit the market.
- No minimum amount- It’s astounding to buy the yellow metal with an amount as low as Rs 1. This is not possible physically. Hence, digital gold allows everyone, who uses digital platforms and is interested in investing in gold, to hold gold.
- No storage hassle- Digital gold removes your worries related to storage. Without any storage charges, service providers store your holdings and they are 100% insured. It also eliminates concerns like expensive locker fees and the possibility of theft. Credible players like MMTC-PAMP ensure that your gold is stored in bank-grade vaults and is ensured by a trustee. There is no outsourcing of storage to a third party and hence your gold remains safe with us.
- Genuine and pure gold- Whenever you buy physical gold, you remain in doubt about the purity. This is not the case with digital gold. It is genuine and its purity is 24K 999.9 when brought from trusted partners. It removes the need for middlemen to assess the purity and save your cost.
As gold is a resilient and stable investment option, the inclination of investors toward digital gold is increasing by the day. The flexibility and advantages that digital gold offers have made it a perfect investment choice for today’s tech-savvy generation. As they can buy it anytime and from anywhere for their short and long-term investment purposes, they make decisions according to price fluctuations. Festive months and auspicious occasions just increase their desire to hold gold and facilitate them in quick decision making and buying digital gold.
Authored by – Mr. Vikas Singh, CEO and MD of MMTC-PAMP.