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Is digital gold backed by actual gold?

By Finserv MARKETS - Aug 2,2019
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Is digital gold backed by actual gold

In India, gold represents prosperity. It is customary for Indian families to buy gold during auspicious occasions like Dhanteras, Akshay Tritiya etc. The custom of gifting gold jewellery on birthdays and weddings is also a part of the same tradition. But with the rapid urbanization, India has seen physical gold has become more and more inconvenient. Not only does the youth of India no longer swear by gold as their go-to metal of choice when it comes to jewellery, nor does it want to have to go through the hassles involved in ensuring the safety, quality and authenticity of the gold.

This is precisely why Digital Gold has become such a hit with the Indian youth. Digital gold is nothing but a simple and transparent way in which anyone anywhere, can invest in gold, through a simple online transaction. The best part? Every gram of online gold purchase that is accumulated in your Digital Gold account is backed up by an equal amount of physical gold! This means that at any given time in the future, you can convert your accumulated online gold into physical gold or money of an equal value which will then be dispatched to you in the form of coins or bars or money to your desired address.

So, if you want to invest in digital gold, here are a few things you should know:

  • You can choose to buy up to 99.5% 24 karat gold from platforms like Finserv MARKETS with amounts as low or as high as you please. Previously in order to be able to invest in gold, you’d have to wait till you had saved up enough money because physical gold was available only in tangible quantities like say 1gm, which would easily cost over Rs 3,200 at the current market rates. The advent of purchasing Gold online has tackled this problem altogether, which now allows you to make investments in fractions of grams. In this way, it encourages people to invest even if they have limited income, thanks to its small investment size. Moreover, every rupee that you spend buying digital gold, is backed by real physical gold that is insured and kept safely with a reputed Custodian on a consolidated basis.
  • In comparison with other asset classes, gold is considered to be the most liquid asset. However, when it comes to physical gold, there still are some major liquidity-related issues that inevitably come up. For instance, to sell physical gold, you will have to visit a dealer or bank or your local jewellery shop. Additionally, you’ll need to have your purchase bill, without which you will never get the complete resale value on your gold. Infact, sometimes even with the purchase bill, the jewellery store might give you lower rates, because the gold was not originally purchased from the same shop. Digital Gold overcomes all these issues and allows you to buy or sell gold online anytime by just logging into the internet, where your transaction will be based on the live gold prices.
  • Apart from Digital Gold, you can also choose to opt for Gold exchange-traded funds (ETFs) that can be traded online. But remember that to invest in Gold ETFs, a DEMAT account is necessary. On the other hand, Gold can be easily traded online without the need of an account.
  • Zero Storage Hassles: One of the major impediments that prevents people from investing in physical gold is the auxiliary safety issues. If you keep it at home, you will always be under the fear of it being stolen. Naturally, most people prefer to keep it in bank safes or vaults, each of which comes with its own additional charges in the form of applicable registration fees, annual charges, service charges, etc. Gold purchased online gives you freedom from all of these charges and has no long-term expensive costs. The gold purchased is tested using different parameters such as weight and purity, after which it is accepted in the vault for safekeeping. Most Digital Gold traders offer you the facility to hold your accumulated gold in secure vaults without additional charges or at a nominal cost.

Thus, with Digital Gold, you have all the advantages that make gold such a lucrative investment without any of its hassles. Infact, Digital Gold investments combine the stability of physical gold with the convenience of digital mediums. Finserv MARKETS is a trusted partner for more than 100 million customers across the country. With Gold available on the Finserv MARKETS platform, you are sure to enjoy the 2-click buying process. Moreover, without the need for any kind of documentation, the whole process faster and so much more convenient.

Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere!


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Bajaj Finserv Direct Limited ("BFDL") is primarily engaged in distribution of financial products and services through its digital platform (“Bajaj Finserv MARKETS”) and inter alia renders services of customer acquisition, providing preliminary credit support activities, fulfilment services and post-acquisition customer services to Banks, NBFCs, HFCs. BFDL is also a registered Corporate Agent (Composite) under valid IRDAI registration number: CA0551 valid till 10-Apr-2024 for solicitation and servicing of Insurance Products. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522