This Indian festival popular for gold shopping has gone digital this year to lure millennials

• Digital gold is luring Indian consumers on the festival of Akshay Tritiya this year.
  
• In March, digital payments arm of Google, Google Pay also launched gold investment options to its customers in India.
  
• Ever since the launch, the digital gold market has seen strong growth, with an estimated over 80 million people who had digital accounts as of March 2019.

Indians love and swear by gold as a trusted investment asset so much they even have festivals popular for buying gold. Akshay Tritiya, an annual spring festival in India, is one such fare.

But this year, the festival has taken a digital twist. With the launch of ‘Digital Gold’ in India, Indians considering buying gold on the occasion of Akshaya Tritiya, also have a number of digital options if they fancy.

Given that, National Stock Exchange (NSE) is even conducting a trade session dedicated to gold exchange and trade on Tuesday, on account of Akshaya Tritiya to give Indians this “smart investment option.”

In March, digital payments arm of Google, Google Pay also launched gold investment options to its customers in India.

What is ‘Digital Gold?’

‘Digital gold’ is basically buying and selling of gold via online platforms and mobile wallets. These sites are reportedly offering everything from gold coins, gold bars and even gold jewellery, but in the form of ‘digital gold.’

The digital method allows one to buy 99.9% 24 karat gold. One can buy gold in small quantities in rupees or grams digitally and that can be redeemed at a physical gold shop against jewellery or sold later.

However, the price at which the digital gold is sold is valid for only for 6 minutes.

Where to buy?

Digital wallets including Google Pay, PhonePe, Mobikwik and PayTm, among others have all rolled out the ‘digital gold’ option on their platforms in partnership with MMTC-PAMP or SafeGold, under the Gold Accumulation Plan(GAP). SafeGold is a joint venture between Invent Capital, a private equity firm, and World Gold Council. Users can buy digital gold via online wallets and store in online accounts — which are linked to GAP.

Why the digital mode?

Digital gold is being touted as a “smart and economic investment option.” That’s because while the prices of gold may vary between 4%-5% on the retail price of gold from the actual price, the price variation on digital gold is said to vary between 1.5% to 2%. There’s also no storage cost for digital gold and can be kept for a maximum of five years period. After that, the user can either sell it or can be converted into gold jewellery.

Ever since the launch, the digital gold market has seen strong growth, with an estimated over 80 million people who had digital accounts as of March 2019. But there are also concerns over the lack of regulation in the emerging sector.

See also:
Google Pay wants to offer Indians their favourite investment option – gold