Dhanteras falls on Friday 6 November 2026 and Diwali on Sunday 8 November. In the weeks before, your phone will fill with offers to buy gold for as little as ₹1. Before you tap, one fact: SEBI said in November 2025 that digital gold is not regulated by it. Here is what that means in plain terms, and how it differs from a gold ETF.
What SEBI said
SEBI issued a caution to the public on 8 November 2025 (press release 70/2025). According to MediaNama's report, digital gold products have "neither been notified as securities nor are they regulated as commodity derivatives." SEBI added: "Investors/participants are made aware that none of the investor protection mechanisms under securities market purview shall be available for investments in such Digital Gold/ E-Gold products."
All India Radio's report adds the reason: some online platforms were promoting these products as alternatives to physical gold. Neither SEBI nor the RBI oversees them, MediaNama says, which leaves counterparty and operational risk if a platform fails.
People are buying more anyway
Outlook Money reported on 21 September 2026 that digital gold purchases in August 2026 were up 110% from August 2025. It cites about ₹2,500 crore a month on average between June and August, and nearly ₹7,500 crore over the three months.
A February 2026 explainer from Stashfin said SEBI's November caution remained the operative position in early 2026. I did not find a later change. Check for newer announcements before you buy.
What the regulated alternatives look like
SEBI named three routes in its caution, as MediaNama lists them: gold exchange traded funds offered by mutual funds, electronic gold receipts traded on stock exchanges, and exchange-traded commodity derivative contracts. Outlook Money also mentions Sovereign Gold Bonds bought from the secondary market.
The practical difference for you: a gold ETF is a SEBI-regulated fund unit that you buy and sell on an exchange through a demat account. Digital gold is usually bought in small amounts in an app, and the company behind it is not under that safety net.
A worked example: what the costs look like
MediaNama's list of risks includes hidden markups beyond the 3% GST. Here is what that can mean for a ₹10,000 purchase.
If the ₹10,000 you pay includes 3% GST, the gold itself is worth ₹10,000 ÷ 1.03, about ₹9,709. The GST is about ₹291.
Now suppose the platform buys back at a price 3% lower than it sells. That 3% is my assumption for illustration, not a quoted rate. Selling straight back would give you about ₹9,417.
So you would be down roughly ₹583 on a ₹10,000 purchase before the gold price moves at all. The point is that costs matter most if you plan to hold for a short time. Over many years, they are a smaller share. Gold prices can also fall, and no one can predict them.
Questions to put to any platform
Who holds the physical gold, and where is it stored?
Who audits it, and how often?
What is the gap between today's buy and sell price?
Can I redeem as coins or bars, and what does that cost?
What happens to my holding if the company shuts down?
Where do I complain, and does any regulator take that complaint?
If the answers are vague, treat that as an answer. For a gold ETF, the equivalent questions are about its expense ratio and how easily you can sell, which you can find in its fund documents.
How the ETF route works, step by step
You buy through a demat account with a broker.
You search for gold ETFs and compare their expense ratios and how actively they trade. Each unit's price follows the gold price, and you can buy a single unit or a few.
You sell on the exchange while it is open, at the market price.
Your holding sits in your own demat account, and the fund's documents explain how it holds the gold.
That is more steps than tapping an offer in an app, which is part of why apps are popular. The extra steps are what place you under SEBI's protections: the fund is regulated, and your holding is recorded in your own account. Before you buy, ask three things: the expense ratio, how easily you can sell, and who the custodian is.
Outlook Money also mentions Sovereign Gold Bonds bought on the secondary market. Check how easily you can sell before you buy, since you are depending on a buyer being there.
Before Dhanteras
Decide the purpose first. Gold for a gift or tradition is a different decision from gold as an investment.
Decide how much. Gold is one slice of savings, not the whole plan. How big a slice depends on your goals.
Ignore promises. Any offer that talks about guaranteed gains deserves a second look.
Compare at the time you buy. Prices and offers can move quickly in the days before a festival, so an old screenshot is not a quote.
Keep records. Save invoices and statements, whichever form you choose.
I am not naming a best option, because none exists for everyone. A regulated route gives you more protection if something goes wrong. An unregulated one may feel easier and smaller, which is exactly why it is popular.
This is general information, not financial advice. Check SEBI's own caution and your platform's terms before you decide.
