Gold as an investment option is always favoured among Indians. Generally, it is believed that gold is the safest asset for investment as it is perceived that gold value appreciates. In markets like India Gold has high liquidity, which means that it can be converted to cash faster than most other assets.

Is buying gold coins a good investment? 

It is good to have gold investment as part of portfolio diversification but gold is better off as coin investment rather than jewellery, as is the case with most Indians. Think of some of the benefits of gold coin investment if you are planning to invest in gold. 

  • Gold coins have higher liquidity and can be converted into cash easily 
  • Gold prices tend to go up when other investment avenues like bonds go down, therefore, gold coin prices more or less match up the actual market price unlike jewellery 
  • Making charges on gold coins are lesser
  • Gold coins come with hallmarks and 99.9% purity assurance, though hallmark on jewellery is yet to take effect 

What are the ways to invest in gold coins in India?

Though jewellery purchase is a popular form of gold investment in India, gold coins can be purchased too. But before you buy one, keep these pointers in mind:

Invest in Sovereign Gold Bonds

  • 2.5% interest per annum
  • No capital gains tax on maturity
  • Check the purity of the coins which will reveal the quantity of carat gold used in its making. 
  • Check the authentic hallmark that works as an identification of purity. 
  • The weight of the coin helps to know how many grams the coin is. 

Where to buy?

From Banks

One of the places to buy gold coins is to buy them from banks.

Benefits of buying gold coins from banks: 

  • Offers discounts if the person buys the coins in bulk quantity. 
  • Banks offer gold coins of the highest purity that is – 24 carat – 999.9 purity.
  • Tamper-proof packaging to the purchased gold coins. 
  • Banks also serve as a certification of authenticity of the gold coins

Many consider banks as the best place to buy gold coins in India as their reach is widespread in the country. And the gold rate is likely to remain the same across different banks or at least the same banks in different cities. 

From jewellers

Alternatively, you can buy them from jewellers as well. However, keep in mind that not all jewellers would exchange gold coins for cash. Instead, they generally expect you as a customer to buy gold jewellery for the same amount. 

Note that, the gold rate varies with jewellers across different cities within the same State and across the State as well. 

From other sources

With the outbreak of pandemic last year, gold buying too has moved online. Most of the jewellers launched digital platforms to enable buyers to purchase not only jewellery but also gold coins. 

There are other digital platforms or mobile applications that have come up in the past year, through which you as a consumer can buy gold coins. These platforms are backed by companies (such as Augmont Gold or MMTC-PAMP) that sell gold or are into gold trading. 

While the buying process of gold appears seamless through these mobile applications or digital wallets, regulation is yet to be on a strong footing. Therefore, gold coin investment through these platforms is to be taken with a pinch of salt, despite being secure.