Since the Covid pandemic, gold prices rallied to all-time historical highs that motivated a lot of investors to invest in this precious and elite metal. Investors who are not well aware of the different avenues of investment in gold gradually became interested in the same.
Hence if you are one of those investors who is looking forward to investing in gold, you should first identify the purpose behind it. If someone is aiming for returns and profit out of it, then digital gold is the ideal choice.
In this article, we are going to particularly about Digital Gold and should you opt for it? Let’s get started.
WHAT IS DIGITAL GOLD?
Digital gold can be defined as a 24 carat 99.9% pure gold investment without the stress and burden of storage. It is brought through online mode via UPI transactions or internet banking. The amount is paid online and the seller provides an invoice digitally for the purchase within minutes.
When somebody buys gold in digital form, the company will stock it in its facilities in vaults that are highly secured, which relived the investor of any risk of theft. In the case of physically buying gifts, if you are not buying hallmarked jewellery, there will no certainty with respect to purity. This won’t be a problem in digital gold as it is certified by licensed government agencies.
WORKING OF DIGITAL GOLD
Investors can invest in digital gold with our ZFunds app. Currently, there are 3 companies that offer digital gold across the country:
- Digital Gold India Pvt/Ltd with its SafeGold brand.
- Augmont Gold Ltd
- MMTC-PAMP India Pvt Ltd is a joint venture between state-run MMTC Ltd and swiss firm MKS PAMP
Our ZFunds app only provides a platform through Augmont Gold Ltd. Once investors invest in digital gold, these entities purchase an equivalent amount of gold and store it under its name in vaults.
MERITS OF INVESTING IN DIGITAL GOLD
1. Uniform Price
The price of digital gold is the same across the nation when compared to physical gold, whose price varies from city to city and jeweller to jeweller. Physical gold also carries high making charges while digital gold only holds 3% GST.
Investors do not have to pay banks for lockers, insurance covers or any other investment of FD. Sellers assure that the digital gold is well stored in a secured and unsecured vault with no additional cost.
Sellers point out that digital gold investment is made in licensed and certified 24 Carat 999.9 pure gold ascertaining the purity of physical gold without any additional cost.
Investors can start even with Rs 10 or 100 and build up their holdings over a time frame. Buying and investing in physical gold required a lot of funds.
Investors can redeem or sell their digital gold instantly while physical gold can only be sold or exchange through a jeweller or several jewellers some time.
Digital gold can also be used as security or collateral against loans taken from banks or other financial institutions.