Gold has always been a trusted investment for Indians, offering stability and long-term value. For Non-Resident Indians (NRIs), investing in gold comes with unique challenges like taxation, storage, and regulations. Until recently, Sovereign Gold Bonds (SGBs) were a top choice for NRIs, but they are no longer available. This change, announced in the Union Budget 2025, has left many NRIs looking for alternative gold investment options such as Digital Gold, Gold ETFs, Gold Mutual Funds, and Physical Gold.
If you’re an NRI looking to invest in gold, here’s what you need to know.
What Happened to Sovereign Gold Bonds (SGBs) for NRIs?
SGBs were discontinued for NRIs as of the Union Budget 2025. These bonds, backed by the Reserve Bank of India (RBI), offered 2.5% annual interest along with capital appreciation. While NRIs who previously bought SGBs can hold them until maturity, they can no longer purchase new ones.
Why Were SGBs Discontinued for NRIs?
- Regulatory Concerns: The government aims to streamline gold investments within India’s domestic financial system.
- Taxation Complexity: NRIs have different tax obligations across countries, making taxation difficult.
- Investment Restrictions: The government enforces residency-based investment criteria for financial security.
Since SGBs are no longer an option, let’s explore alternative gold investment choices for NRIs.
Digital Gold: The Most Convenient Gold Investment for NRIs
Digital Gold allows NRIs to invest in 24K real gold online, securely stored in insured vaults by trusted entities like MMTC-PAMP, India’s leading gold refinery. This investment option offers convenience, security, and flexibility, making it a preferred choice for NRIs.
One of the biggest advantages of Digital Gold is accessibility. NRIs can buy and sell gold anytime, from anywhere in the world, using online platforms. Investments can start with as little as ₹1, making it highly affordable. Additionally, since the gold is stored in secure vaults, investors don’t have to worry about theft, storage costs, or insurance. Unlike Gold ETFs, Digital Gold does not require a Demat account, making it easy to invest in without extra paperwork.
However, there are a few things to keep in mind. Capital gains tax applies in India, and depending on an NRI’s country of residence, there may be additional tax implications. Some platforms also impose withdrawal or redemption limits, so investors should check these details before committing.
Also explore: Retirement Planning with Digital Gold Investment
Gold ETFs: A Market-Linked Gold Investment
Gold Exchange-Traded Funds (ETFs) provide exposure to gold prices through stock exchanges. These funds are backed by physical gold and offer a secure way to invest without the challenges of storing physical assets.
Gold ETFs can be easily bought and sold on the stock exchange, making them a liquid investment option. They are regulated financial instruments, ensuring safety and transparency. Additionally, long-term capital gains tax applies after three years (with indexation benefits), making it a tax-efficient way to invest in gold.
NRIs looking to invest in Gold ETFs can do so through an NRE/NRO account. A Demat and trading account is required, which adds an extra step compared to Digital Gold. Additionally, since Gold ETFs are market-linked, their returns may fluctuate with gold prices.
Gold Mutual Funds: A Simpler Investment than Gold ETFs
Gold Mutual Funds are an alternative for NRIs who want exposure to gold without directly investing in ETFs. These funds invest in Gold ETFs or gold mining companies, providing professional management and diversification.
One key benefit is that a Demat account is not required, making investment simpler. NRIs can also start Systematic Investment Plans (SIPs), allowing them to invest in gold gradually over time. Professional fund managers handle the investments, making it a passive and well-managed option.
Like Gold ETFs, market volatility can affect its performance, making it less predictable than Digital Gold.
Physical Gold Investment: Traditional but Less Practical for NRIs
Many NRIs still prefer investing in physical gold, such as jewelry, coins, or bars. While physical gold has cultural significance, it comes with several challenges.
Storage is a major concern, as keeping large quantities of gold safe can be difficult. Many NRIs opt for bank lockers in India, but this adds extra costs and accessibility issues. Import duties are also a drawback, as carrying gold abroad attracts high customs charges. Additionally, making charges on jewelry can significantly reduce its resale value. Security risks, such as theft, fraud, and loss, make this option less practical compared to Digital Gold or ETFs.
For NRIs looking for a secure, hassle-free way to invest in gold, Digital Gold Investment remains the best option.
NRIs can use SBNRI App to Invest in Gold Digitally
SBNRI’s first-ever Digital Gold investment platform brings NRIs a safe and seamless way to invest in 99.99% real gold (as real as it can get). It is backed by our trusted partnership with MMTC-PAMP, India’s most reliable gold custodian.
MMTC-PAMP, a joint venture between MMTC Ltd (a Government of India Undertaking) and Switzerland’s renowned bullion brand PAMP SA. It is India’s most recognized name in gold and silver. In fact, it is India’s only LBMA-accredited gold refinery, meeting the highest global purity standards.
Why should NRIs Trust SBNRI for Digital Gold?
- 100% Insured Investment: Your gold is fully insured by MMTC-PAMP, ensuring complete security.
- Bank-Grade Vault Storage: Your gold is stored in fully insured, high-security vaults, eliminating storage worries.
- Easy Buyback: Sell your gold anytime at live market prices directly to MMTC-PAMP.
- Unmatched Purity: Invest in 24K, 999.9 pure gold, accredited by LBMA, the global gold standard.
- No Storage Charges: Unlike physical gold, storing your Digital Gold is free, with no hidden costs.
This platform is exclusively designed for NRIs and offers a secure, flexible, and hassle-free way to invest in gold with complete peace of mind. Whether you want to buy, sell, or redeem, everything happens seamlessly in just a few clicks on the SBNRI app.
Start Your Gold Investment Journey Today!
FAQs
1. Can NRIs invest in Sovereign Gold Bonds (SGBs)?
No, as per the Union Budget 2025, NRIs can no longer purchase new SGBs. However, they can hold previously purchased bonds until maturity.
2. How is digital gold stored?
Digital gold is stored in insured, highly secure vaults by MMTC-PAMP, ensuring complete safety.
3. Are Gold ETFs better than digital gold?
Gold ETFs require a Demat and trading account, whereas digital gold is simpler and can be bought instantly without the need of a demat account.
4. Is physical gold a good investment for NRIs?
Physical gold has storage, security, and import duty concerns, making it a less practical option compared to digital gold for NRIs.
5. How is digital gold taxed in India?
Profits from digital gold are subject to capital gains tax, based on the holding period.
6. Can NRIs invest in gold mutual funds?
Yes, NRIs can invest in gold mutual funds with funds through their NRE/NRO accounts, without needing a Demat account. However, if you wish to hold gold mutual funds in digital form, you will require a demat and trading account.
7. Why should NRIs invest in gold?
Gold acts as a hedge against inflation, a stable asset in uncertain times, and a great way to diversify an investment portfolio.
