Warning: strpos() expects parameter 1 to be string, array given in /var/www/wealthcafe.in/wp-content/plugins/jetpack/modules/shortcodes/ted.php on line 110
In today’s time when we can do every other transaction online then why not invest in Gold. Almost all the wallets and payment portals let you invest in 1 gram 99.99% finesse gold.
What is Digital Gold:
Digital Gold is relatively new in the market. It is a simple way to buy and sell gold instantly. With physical gold one has to save enough, go to the store and buy the same. In physical gold, you either buy it as jewelry or coins. Digital Gold as the name suggests can be bought online in digital form online. The same is in your online account. You will have to sell the same to buy gold jewelry, coins or get cash in return.
How to buy Digital Gold
You can get digital gold via any of the following portals:
- Phone Pe
- HDFC Securities
- Motilal Oswal Securities
- Stock Holding Corporations of India
Where is your Gold kept?
You gold is stored in vaults of MMTC-PAMP tagged in your name. MMTC – PAMP is a joint venture between Switzerland based bullion brand, PAMP SA, and MMTC Ltd, a Government of India Undertaking.
- A customer using either of the two platforms can buy 24 Karat / 999 fineness gold.
- Some of these portals allow you to buy gold with a minimum value of INR ONE.
- You can buy & sell gold anytime even on public holidays and weekends.
- There is a limit of tenure up to which you can invest in digital gold after that you can either convert it to jewelry or cash.
- It is important to keep your account with these portals active – Paytm has a time period of 6 months. Without any transactions for 6 months your account is inactive.
- Non-cancellation – Once you have placed a transaction (buy or sell) on these platforms, you cannot cancel the same.
What to do with digital gold
You can use your digital gold to buy gold jewelry with partner jewelers of the portals you are using to buy digital gold, sell and get cash on prevailing rates or get gold coins in return.
However, the price at which a customer can sell the digital gold back to Paytm is slightly less than the price at which he can buy the gold, says Hegde. This is due to various transaction-related costs including taxes, bank charges for processing your payment, technology costs and hedging costs since the market prices may fluctuate between a customer placing an order and MMTC-PAMP buying the gold. Similar costs are involved while selling of gold by MMTC-PAMP, too, when a customer sells gold on the Paytm. The same must be rechecked with other portals as well.
It is important that you check the costs that you have to bear when you sell your digital gold for cash or the making charges for coins and any other charges that may be applicable.
Is digital gold safe?
There has been some debate around it being a safe investment option or what guarantee does an investor have? One of the biggest risks of investing in digital gold is that it is not regulated yet. All these platforms – Paytm, Phone Pe, Google pay and others act as a platform or payment portals to help you buy gold which is safely kept with MMTC PAMP, it is not with these portals. Hence, it is very important to know where and how you are investing because if tomorrow any of these portals, you as an investor should have a redressal system in place to go to or approach MMTC PAMP directly. There are some grey areas on this right now. The convenience of investing in gold through these portals comes at a cost and you must be aware of the same.
Wealth Cafe actionable – Digital gold is a very interesting new addition to the world of investing in gold and it allows you to invest in smaller proportions in gold. However, there are more regulated means of investing in gold where the risk is relatively less.