Diwali 2025 Gold Buying Guide: Should You Choose Digital Or Physical Gold This Festive Season
Gold prices have remained resilient just below the $4,000-per-ounce mark (around ₹12,200 per 10 grams for 24-karat), marking their eighth consecutive weekly gain. As India enters the festive season, the continuous rise in gold rates has sparked mixed emotions among consumers. According to experts, this sharp surge—delivering returns of over 50% in 2025—has boosted investor confidence but slightly dampened retail buying sentiment during Diwali, traditionally considered an auspicious period for gold purchases.
Experts attribute this rally to multiple factors including heightened geopolitical risks, tariff-related concerns, and the weakening of key currencies against the dollar. With investors shifting towards safer assets, gold continues to be perceived as a secure store of value during uncertain times.
One of the biggest benefits of digital gold is flexibility. Investors can start with as little as ₹1, making it a practical choice for small-scale investors or young buyers looking to diversify their portfolio. The purchased gold—24-karat pure—is securely stored by the service provider, eliminating worries about theft or maintenance.
Furthermore, digital gold offers real-time pricing and can be liquidated instantly, unlike physical gold which requires physical exchange or valuation checks. It also suits both short-term and long-term investment goals.
A 3% Goods and Services Tax (GST) is applicable at the time of purchase, similar to physical gold. These factors make it crucial for investors to align their digital gold purchases with their financial timelines and objectives.
However, purchasing physical gold comes with additional expenses. Apart from the 3% GST, jewellery buyers pay making charges that typically range between 10% and 20%. These costs make physical gold more expensive than its digital counterpart. Additionally, safe storage—either at home or in bank lockers—adds to the overall expense.
Experts suggest that while physical gold offers sentimental value and tangible satisfaction, it may not always be the most efficient investment, particularly for those seeking liquidity or short-term returns.
A balanced approach—combining both physical and digital assets—can help maintain both emotional and financial value. As festive demand continues, the outlook for gold remains positive, supported by global economic trends and the metal’s reputation as a safe-haven asset.
Disclaimer: This article is for informational purposes only. The information and opinions presented are based on expert inputs and should not be considered financial advice. Investors are advised to consult certified financial planners before making investment decisions.
Gold Prices Stay Firm Despite Festive Hesitation
Gold has witnessed a steady climb in 2025, gaining almost 52% so far, supported by global uncertainty, renewed rate-cut expectations, and economic slowdown fears. The metal briefly touched a record high of $4,059 per ounce this week, maintaining a 2.2% gain for the week. In India, 24-karat gold was priced at approximately ₹12,273 per 10 grams, reflecting both global trends and robust investor demand.Experts attribute this rally to multiple factors including heightened geopolitical risks, tariff-related concerns, and the weakening of key currencies against the dollar. With investors shifting towards safer assets, gold continues to be perceived as a secure store of value during uncertain times.
Why Digital Gold Is Gaining Popularity
Digital gold has emerged as a modern and accessible investment avenue for those who want exposure to gold without the complications of storage and security. Experts explain that it allows users to buy, sell, and store gold online through authorised platforms such as mobile wallets, banking apps, and jewellery websites.One of the biggest benefits of digital gold is flexibility. Investors can start with as little as ₹1, making it a practical choice for small-scale investors or young buyers looking to diversify their portfolio. The purchased gold—24-karat pure—is securely stored by the service provider, eliminating worries about theft or maintenance.
Furthermore, digital gold offers real-time pricing and can be liquidated instantly, unlike physical gold which requires physical exchange or valuation checks. It also suits both short-term and long-term investment goals.
Understanding Taxation on Digital Gold
From a taxation perspective, experts point out that digital gold is treated on par with physical gold. When sold within 12 months of purchase, profits are considered short-term capital gains and taxed as per the investor’s income tax slab. If held for over 12 months, the gains qualify as long-term capital gains, attracting a 12.5% tax.A 3% Goods and Services Tax (GST) is applicable at the time of purchase, similar to physical gold. These factors make it crucial for investors to align their digital gold purchases with their financial timelines and objectives.
The Enduring Appeal of Physical Gold
Despite the growing interest in digital options, physical gold continues to hold cultural and emotional significance in Indian households. Coins, bars, and jewellery remain traditional choices, often linked with milestones such as weddings, festivals, and family celebrations.However, purchasing physical gold comes with additional expenses. Apart from the 3% GST, jewellery buyers pay making charges that typically range between 10% and 20%. These costs make physical gold more expensive than its digital counterpart. Additionally, safe storage—either at home or in bank lockers—adds to the overall expense.
Experts suggest that while physical gold offers sentimental value and tangible satisfaction, it may not always be the most efficient investment, particularly for those seeking liquidity or short-term returns.
What Should Buyers Consider Now
With gold prices at record highs, experts recommend that consumers evaluate their purpose before purchasing. Those looking to buy gold for cultural or ceremonial reasons may still prefer physical gold, whereas investors focusing on portfolio diversification and convenience could opt for digital formats or Gold ETFs .A balanced approach—combining both physical and digital assets—can help maintain both emotional and financial value. As festive demand continues, the outlook for gold remains positive, supported by global economic trends and the metal’s reputation as a safe-haven asset.
Disclaimer: This article is for informational purposes only. The information and opinions presented are based on expert inputs and should not be considered financial advice. Investors are advised to consult certified financial planners before making investment decisions.
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