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Democratising investment: Interview with Ashraf Rizvi, CEO of Gilded

By Puja Sharma

December 29, 2021

  • AI
  • Alternative Lending
  • digital gifts
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Ashraf Rizvi

Digital gold democratizes the process of investment in gold by allowing fractional investments.

While gold has been historically seen as a safe investment, digital gold has been making its way into Indian homes and is also being considered as a great gifting option by millennials. Digital gold will not only enable customers to own Swiss gold but will also possess a safe asset that will give long-term returns and build wealth.

Gilded is a new-age wealth-tech app offering long-term savings through fractional gold investment. Digital gold leverages current technology and brings the traditional gold asset to the 21st century. Gilded integrates blockchain technology to offer immutable ownership of Swiss-refined 0.9999 purity physical gold as buyer’s title and property through a simple mobile app. The purchased digital gold is accessible 24/7 to the users and can be sold easily too.

IBS Intelligence interacted with Ashraf about the emergence of digital gold as an alternate investment.

What is digital gold?

Digital gold can be 24K, 99.99% pure physical gold that one can buy and access digitally if you find the right provider. The gold is automatically allocated to the buyer and usually stored in a vault by the digital provider. This empowers customers with the ability to buy, hold and sell gold using online platforms around the clock with the tap of a button.

This is similar to depositing cash in a bank account in many ways. Securely tracking digital ownership can allow fractional purchases of a larger bar at low ticket prices. The process of buying gold can become functional, approachable, efficient, safer than other methods, and democratized. People can invest in gold for as little as Rs. 100 with the right provider who has these standards.

What is the difference between digital gold and other gold offerings, such as SGBs?

Digital gold usually provides additional benefits and flexibility for buyers compared to SGBs(Sovereign Gold Bond Scheme). With digital gold, you buy the value of gold stored in physical form in a vault. A quality digital gold provider ensures the full value of gold invested, unlike SGBs. Liquidity is often also a major differentiator. Check your digital gold provider to see if your gold can be sold at market price in case of emergencies, unlike SGBs that come with a holding period of a minimum of five years, making them unavailable for the investor’s immediate cash/financial needs.

On the other hand, true digital gold is available 24/7. With digital gold, investors can often buy a large sum in one go or make small investments spread over weeks or months, depending on their purchasing power. The quality of digital gold should stand higher at 0.9999 than that of SGB at 0.999.

Things to keep in mind while investing in digital gold?

  • The Platform – The investor should carefully research and choose a trustworthy and safe platform.
  • Storage Charges – When one buys digital gold, the purchased quantity is allocated against the details of the investor and stored in a vault. These details should be carefully reviewed and considered. Different platforms might have various storage facilities, ranging from free, to chargeable, to chargeable after a certain period.
  • Delivery Charges and Making charges – Many platforms promise the investor the option of delivery of the physical gold that has been purchased or conversion of the gold into jewelry. The investor must conduct proper research on hidden charges, like exorbitant delivery or making/fabrication charges.

How can digital gold make physical gold functional, usable, mobile, and affordable through fractional investments?

Digital gold democratizes the process of investment in gold by allowing fractional investments. In the past, investing in the yellow metal was both restricted to certain social strata or required long periods of savings and planning to accumulate an amount of savings sufficient for purchase. Now, anyone can invest in digital gold for denominations as low as ₹100 with the right provider. An investor should also be able to sell the digital gold at the click of a button, avoiding physical visits as were required earlier.

Digital gold is attracting a younger group of investors into this traditional asset…

Millennials and Gen Zs, the digital natives, are showing an interest in digital gold as it emerges as a new asset class. Access to investment options and information on a mobile phone is a basic expectation. Instant purchases, trackability, quality assurance, and instant sale, all at the tap of a button from the comfort of one’s home, are what have been of interest to young investors.

Digital gold appeals across generations, be they Gen Zs, Millennials, or older generations, as it allows Indians to marry tradition with a digitally savvy lifestyle. People could not travel to meet and celebrate special occasions with their friends and family during the pandemic. Here, digital gifts became an important alternative.

Since gold is a traditional asset with auspiciousness attached to it and is often gifted during festivals and weddings, digital gold became a great gifting option. With digital gold, customers do not have to worry about storage as they can rest assured that their gold is stored securely in fully-insured vaults. Safe transportation of the precious metal is also not an issue as digital gold can be sent to recipients across the country easily with a few taps through the application on their mobile phones.

What are the factors enhancing the interest of Millennials and Gen Zs towards digital gold?

Millennials and Gen Zs have grown up with the internet and have witnessed the evolution of technology into a tool transforming traditional processes with convenience. This is seamless for digital natives who expect and vastly prefer digital alternatives and represents one of the primary reasons for their interest in purchasing and investing in digital gold. Additionally, digital gold also provides a great long-term investment and wealth creation opportunity. The elimination of the tedious physical gold buying process and storage concerns, along with the alignment with their personal finance goals, makes digital gold an attractive asset for Millennials and Gen Zs.

What is the future potential for digital gold, in your opinion?

Digital gold has just begun gaining prominence. Its rise was propelled further due to the rapid digitization that became essential during the pandemic. Indians, who usually preferred purchasing gold physically, realized the convenience of digitally buying physical gold. Hence, many people have now become familiar with the concept of digital gold and its numerous benefits. Gilded has seen a significant rise in demand during festivals and the wedding season. This trend indicates that Indians are becoming comfortable integrating the new-age digital gold into their traditions. Digital gold is only expected to become more mainstream and a common investment and gifting option in the future.

Any comments for the IBS Intelligence readers?

Digital gold is quickly emerging as a new and innovative long-term investment option for people from all walks of life. From the comfort of their home, one can easily enjoy the benefits of the asset popularly known to be a hedge against inflation and uncertainty. The digital gold you purchase through Gilded is your property – you have title to it.

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