If you have invested in e-gold through NSEL (National Spot Exchange Ltd), then there is a procedure to convert those units into physical gold like gold coin or bars and take delivery of the same. The e-gold units held in demat form need to be transferred to the designated beneficiary account of NSEL. A beneficiary account is a demat account in the name of an individual (single or joint holding). It is similar to a bank account. This account is to be used by the account holder for holding and transacting in demat units in electronic form.
Here are some steps involved in converting e-gold into physical:
Submit DIS & SRF
You first need to surrender the e-gold units to the depository participant (DP). You have to submit a delivery instruction slip to the DP along with the surrender request form (SRF)which is available on the NSEL website freely.
The DP will hand over the e-gold units to the NSEL based on DIS. The depository participant then attests the signature of the investor on the transfer request form (TRF) and handover the same to the investor along with the DIS acknowledgement. Remember to take an acknowledgement of the delivery instruction slip. The investor then submits DIS and SRF to NSEL specifying the center of his choice from where he intends to take delivery.
Charges to be paid
On receipt of the copy of DIS and SRF, NSEL would compute charges relating to making and packaging charges of coin/ bar, delivery charges, VAT (value added tax) and other dues (if any).
The Exchange will communicate the total amount due to the respective client through the email ID provided in the surrender request form. The investor will be required to deposit a cheque of requisite amount favouring National Spot Exchange Ltd with the vault. In case the amount payable on above account will be more than Rs. 50,000, the payment will be acceptable by demand draft.
The minimum quantity e-gold units can be converted into 1gm gold coin, and in denominations of 8gm, 10gm, 100gm and 1kg or in combinations of these multiples. 1 unit of e-gold is equivalent to 1gm of gold. General applicable charges are Rs. 200 for 8gm and 10gm, Rs. 100 for 100gm, and no charges if the weight goes up to 1kg of gold conversion.
When you opt for physical delivery against surrender of demat units, you will be required to pay VAT as per the current rate. However, for buying and selling of e-gold units and taking / giving delivery in demat form, you will not be required to pay any VAT, octroi or other taxes.
Physical gold is stored in vault
Equivalent physical gold is kept by NSEL in designated vault having purity of 995 and is fully insured. Delivery of physical gold will be offered in specified denominations and at particular locations only, where NSEL has made vaulting and delivery arrangements. Delivery of physical gold will be made at Ahmedabad, Mumbai, Delhi, Kolkata, Indore, Kanpur, Jaipur, Hyderabad, Cochin, Bangalore and Chennai. Investor has to intimate NSEL about his preferred choice of center in the delivery instruction slip from among the said centers.
The investor can lift the commodity from the designated vault after seven days and within 15 days from date of submission of the request. In case of non-lifting of the delivery within 15 days, the holder shall be liable to pay storage charges for the entire month. You should carry the DIS acknowledgement and original SRF along with the proof of identification.
Procedure for physical delivery of e-gold:
- Submit a delivery instruction slip to DP with the surrender request form
- DP transfers the e-gold units to the NSEL account based on DIS
- DP then attest the signature of the investor on the transfer request form (TRF) and handover the same to the investor along with the acknowledgement of DIS
- Investor then submits DIS & SRF to NSEL specifying the center from where he intends to take delivery
- NSEL computes charges relating to making and packaging charges, delivery charges, VAT and other dues
- NSEL communicates the total amount due to the investor through the Email ID provided in the SRF
- Investor is then required to make such payment through DD/Cheque in favour of “National Spot Exchange Ltd
FAQs
You first need to surrender the e-gold units to the depository participant (DP). You have to submit a delivery instruction slip to the DP along with the surrender request form (SRF)which is available on the NSEL website freely. The DP will hand over the e-gold units to the NSEL based on DIS.
Can I convert digital gold to physical gold in India? ›
Conversion to physical gold
You need a minimum of one gram of gold in your digital gold account to convert it into a physical form of gold, like gold coins, bars, etc. This physical gold can be delivered to your doorstep by paying additional delivery charges to get the gold in the physical form.
How to convert gold bond to physical gold? ›
Sovereign Gold Bonds (SGBs) cannot be converted into physical gold; they are government securities denominated in grams of gold and are intended for investment purposes only.
How to convert physical gold to electronic gold receipt? ›
To convert physical gold into EGRs, customers can deposit their gold with a bank and receive an EGR representing the same amount of gold deposited. Once the customer holds an EGR, they can choose to sell it for cash or redeem it for physical gold at any time.
What is physical gold and e-gold? ›
Physical Gold is defined as gold bought as coins, bars, or jewellery and entirely held by a person or organization. A diverse portfolio of gold or gold-related assets, such as futures contracts, is invested in by Gold ETFs, investment vehicles traded on a stock market.
How to convert e-gold to physical gold? ›
You first need to surrender the e-gold units to the depository participant (DP). You have to submit a delivery instruction slip to the DP along with the surrender request form (SRF)which is available on the NSEL website freely. The DP will hand over the e-gold units to the NSEL based on DIS.
Can I withdraw digital gold? ›
Digital Gold can be bought in multiple transactions, of any denomination and accumulated over a long period of time. When needed, you can redeem your savings as cash into your bank account.
What is the difference between gold bonds and e gold? ›
The main difference between Digital Gold and SGB is that Digital Gold lets you buy gold online in small amounts, whereas Sovereign Gold Bonds are like special savings plans from the government that are tied to the price of gold and pay you interest regularly.
Which is better, gold bond or physical gold? ›
Unlike physical gold, SGBs are a safe investment option as it is dematerialised and, it is devoid of risks of loss involved in hazards of safekeeping or storing of gold, issues around making charges of jewellery and purity of gold purchased. 3.
Are banks buying physical gold? ›
Central banks purchase gold to diversify their reserves and gain liquidity from a ubiquitous asset without credit risk. For institutions and governments with long time horizons, gold's unique characteristics make it a natural option as a reserve asset and store of value.
SEBI Rules over Digital Gold in India | India Infoline (IIFL)
Can digital gold be sold? ›
Digital gold can be bought and sold in a fraction of a second, anytime and anywhere with the convenience of digital access to the commodity.
How to buy EGR in India? ›
The client can trade in EGR online by registering with a stock broker. Further, the client shall have a trading and demat account for trading in EGR.
Is the e-gold discontinued? ›
e-gold is a now defunct gold digital currencies operated by Gold & Silver Reserve Inc. under e-gold Ltd. that allowed the instant transfer of gold ownership between 1996 and 2009, when transfers were suspended due to legal issues.
What is the difference between e-gold and digital gold? ›
They are backed by physical gold of 99.5% purity, which makes them a low-risk investment for investors with a low risk tolerance. Both digital gold and gold ETF may look very similar. The key difference is the physical delivery option by digital gold, while gold ETF does not have this option.
What does E mean in gold? ›
HGE stands for "High Grade Electroplate," "18K HGE" means the item is electroplated with 18 karat gold.
Can NRI buy physical gold in India? ›
There are many ways for NRIs to invest in gold in India such as physical gold, gold ETFs, digital gold and gold mutual funds. However, you are not permitted to invest in sovereign gold bonds. You should consult a tax expert to understand the tax implications on your gold investments.
Is digital gold illegal in India? ›
Here is what you need to know about regulating digital gold. a) As the first step, the exchanges asked brokers to desist from offering digital gold on their platforms. This was followed up in October with SEBI barring RIAs from offering digital gold as an investment option to investors.
Is digital gold taxable in India? ›
Returns from gold held for 36 months or more are termed long-term capital gains; returns from gold that are held for less than this period are termed short-term capital gains (STCG). The tax on the sale of digital gold will attract 20.8% the same as physical gold and paper gold.
Is it better to buy physical or digital gold? ›
Investment Costs: Physical gold carries manufacturing, distribution, and retail markups, while digital gold may offer a more cost-efficient route with potentially lower transaction fees.
