Digital Gold Sets New Record in January

India’s appetite for digital gold investments surged to historic levels in January, with UPI-based purchases touching ₹3,926 crore, according to data released by the National Payments Corporation of India (NPCI).

This marks the highest-ever monthly buying value since digital gold transactions began being tracked. Transaction volumes also jumped sharply to 219 million, highlighting the rapid mainstream adoption of gold buying through fintech platforms.

More importantly, over 90% of all digital gold purchases in India now happen via UPI, underlining how deeply integrated gold investing has become within everyday payment apps.

Why Are Indians Rushing Into Digital Gold?

Several powerful factors came together in January to push gold demand to record levels:

1) Market Volatility & Global Uncertainty

Rising geopolitical tensions, fluctuating global equity markets, and persistent inflation fears drove investors toward safe-haven assets like gold, reinforcing its traditional role as a wealth protector.

2) Rising Gold Prices

Despite record-high prices, investor demand remained robust, showing strong confidence in gold’s long-term value preservation role.

3) Ease of Access via UPI

With investments starting from as little as ₹1, digital gold allows fractional ownership, making gold affordable even for young and first-time investors.

4) Growing Fintech Penetration

Apps like Paytm, PhonePe, Jar, Google Pay, Amazon Pay, and Tanishq have simplified the process, turning gold buying into a one-click habit.

Month-wise Digital Gold Trend: Sharp Recovery After SEBI Warning

Digital gold buying saw a temporary slowdown in November after SEBI warned investors that digital gold is an unregulated product, raising concerns over platform safety and regulatory oversight.

After dipping sharply in November, strong festive demand, rising gold prices, and market volatility triggered a rapid rebound in December and January.

Millennials & Gen Z Fuel India’s Digital Gold Boom

India’s young investors are at the heart of this digital gold revolution. Between January and November 2025, Indians purchased nearly 12 tonnes of digital gold worth ₹16,670 crore, driven largely by millennials and Gen Z investors, according to industry estimates based on NPCI data.

Younger investors prefer:

• Small-ticket investments

• Daily SIP-style buying

• High liquidity

• Digital convenience

This generational shift is reshaping how Indians accumulate gold, moving rapidly away from traditional jewellery and physical bars.

Regulatory Risks: What Investors Must Know

SEBI has explicitly cautioned that digital gold is currently unregulated, meaning:

• Platforms are not governed under SEBI’s investor protection framework

• Storage, redemption, and custody rely on private vaulting partners

• Investors bear counterparty risk if a platform shuts operations

This triggered a sharp slowdown in November, but confidence returned quickly, indicating strong consumer trust in established fintech brands. Industry bodies are now pushing for a dedicated regulatory framework to ensure transparency and long-term stability.

How Digital Gold Works 

• Platforms sell 24-carat gold backed by physical reserves stored with vaulting partners like MMTC-PAMP & SafeGold

• Investors can buy, sell, or redeem anytime

• Includes 3% GST + storage + platform fees

• Alternative: Gold ETFs, which are SEBI-regulated but require demat accounts

Digital gold remains more popular due to ease, accessibility, and ultra-small investment entry points.

What This Means for Investors

The January surge clearly signals:

• Gold remains India’s top safe-haven asset

• Digital investing behaviour is accelerating

• Young investors are reshaping wealth accumulation patterns

• Regulatory clarity could unlock even bigger volumes ahead

With market volatility expected to persist in 2026, digital gold could remain a preferred hedge asset for retail investors.

Bottom Line

India’s ₹4,000 crore digital gold buying spree in January reflects a powerful combination of fear, financial awareness, fintech convenience, and generational change.

As equity markets remain volatile and geopolitical risks linger, digital gold is emerging as India’s most accessible wealth safety net, but regulatory clarity will be key to sustaining this growth.

Frequently Asked Questions

1. What is digital gold, and how does it work in India?

Digital gold allows investors to buy 24-carat gold online in fractional quantities, starting from as low as ₹1. The purchased gold is backed by physical gold stored safely in insured vaults by partners like MMTC-PAMP and SafeGold. Investors can sell or redeem their holdings anytime through supported apps.

2. Why did digital gold sales jump to a record ₹4,000 crore in January?

The surge was driven by global market volatility, geopolitical tensions, rising gold prices, and growing investor preference for safe-haven assets. Easy access through UPI-based fintech platforms also boosted participation, especially among young investors.

3. Is digital gold regulated by SEBI?

No. Digital gold is currently unregulated in India. SEBI has cautioned investors that digital gold platforms do not fall under its regulatory framework, meaning investor protection norms differ from regulated products like gold ETFs and mutual funds.

4. Is digital gold safe for long-term investment?

Digital gold is convenient and flexible but carries platform and counterparty risks due to lack of regulation. For long-term investments, experts suggest diversifying between digital gold, gold ETFs, sovereign gold bonds (SGBs), and physical gold.

5. What are the charges involved in buying digital gold?

Buying digital gold typically includes:

• 3% GST

• Platform convenience fee

• Storage charges

These costs are factored into the final purchase price.

6. How is digital gold different from Gold ETFs?

7. Which platforms offer digital gold in India?

Popular digital gold platforms include: Paytm, PhonePe, Google Pay, Amazon Pay, and Jar Tanishq Digital Gold

8. Is digital gold taxable in India?

Yes. Gains from selling digital gold are taxed as capital gains, similar to physical gold:

• Short-term capital gains (STCG): If held < 3 years → taxed as per income slab

• Long-term capital gains (LTCG): If held > 3 years → 20% with indexation

9. Can I convert digital gold into physical gold?

Yes. Most platforms allow home delivery of physical gold coins or jewellery, subject to minting and delivery charges.

10. Is digital gold good during stock market volatility?

Yes. Gold traditionally acts as a hedge during equity market downturns and geopolitical uncertainty, making digital gold a preferred short-term defensive asset.