Digital Gold: Convenience vs. Hidden Costs & Risks. Sebi Warns Investors

• Digital gold allows investment without physical holding, stored in insured vaults, offering small entry amounts (as low as Rs 10) and online buying/selling.
• Available via apps like Paytm, PhonePe, Google Pay, Amazon, and jewellers like Tanishq; physical gold is sourced by providers like MMTC-PAMP and stored by partners like Brinks India.
• Digital gold is NOT regulated by Sebi, unlike Gold ETFs or sovereign gold bonds, leading to less investor protection and transparency; Sebi cautioned the public in November 2025.
• Costs include platform margins, 3% GST, embedded spreads (2-3% or more on selling), and additional charges for physical conversion; storage costs are often hidden in pricing.
• While convenient for small, gradual investments, experts like Shweta Rajani advise against it for long-term wealth due to hidden costs, counterparty risk, and lack of regulatory safeguards.

Why It Matters: Digital gold offers convenience but lacks regulation, transparency, and has hidden costs; invest cautiously.