On 8 November 2025, India's securities regulator said something worth paying attention to, even though it made headlines for only a day or two.
SEBI issued a public caution: digital gold — the "buy gold in your app, in any amount, anytime" products offered by platforms like CaratLane, PhonePe, Paytm, and Google Pay — is not notified as a security, and is not classified as a commodity derivative either. In plain terms, it sits outside SEBI's regulatory framework entirely.
What SEBI Actually Said
No formal disclosure norms apply to digital gold. No SEBI grievance-redressal mechanism covers it. No capital safeguards protect your money the way they would for a regulated security. The entire arrangement rests on the private company's own terms, insurance, and operational trustworthiness — not on a regulatory framework designed to protect you.
That distinction matters. An unregulated product can still be run honestly and well. But it means the protections you'd expect from a financial product — the ones that exist specifically because something went wrong somewhere else, once — simply don't apply here.
Does It Matter Which Provider I Use?
Some digital gold is backed by more established custodians than others — names like MMTC-PAMP, SafeGold, and Augmont, which store gold in insured, independently verified vaults and have built real operational track records. That's a genuine difference in storage and purity risk.
What it doesn't change is the regulatory category. SEBI's statement applies to digital gold as a product type — the underlying product isn't classified as a security, no matter how reputable the company selling it is. Better storage doesn't convert an unregulated receipt into a regulated financial instrument.
The Regulated Alternative: Gold & Silver Mutual Funds
Gold and silver mutual funds — including gold ETF fund-of-funds — sit in a completely different category. They're regulated under SEBI's Mutual Fund Regulations, the same framework that governs every other mutual fund in India.
Real disclosure norms
NAV, portfolio, and expense ratio are published and regulated — not set unilaterally by the seller.
Held in your own name
You own fund units directly in your folio with the AMC — not a receipt issued by a private company.
A real grievance path
SEBI's SCORES platform exists specifically for complaints against regulated entities — digital gold isn't covered by it.
Where Pyllar Fits
Pyllar is an AMFI-registered mutual fund distributor (ARN 341847) — not a digital gold seller. Every rupee you save through a Pyllar gold or silver SIP buys units of a SEBI-regulated gold or silver mutual fund.
| Gold mutual fund (Pyllar) | Digital gold | |
|---|---|---|
| Regulatory status | SEBI-regulated security | Not a notified security |
| GST on purchase | 0% | 3% (same as physical gold) |
| Where it's held | Your own folio with the AMC | Company's vault, your receipt |
| Grievance redressal | SEBI SCORES | Company's own policy only |
| Making charges on physical conversion | N/A — redeems to cash only | Applies if you convert to coins/jewellery |
You don't have to choose between convenience and regulation. A gold mutual fund SIP is just as easy to start as a digital gold purchase — the difference is entirely in what you end up holding.
Save in gold & silver, the regulated way
SEBI-regulated mutual fund units, not a digital gold receipt. 0% GST. From ₹54/day.
Download Pyllar — Free on Play StoreStart with just ₹54/day.
Frequently Asked Questions
Is digital gold regulated by SEBI?
Does SEBI's warning mean digital gold is a scam?
What's the regulated alternative to digital gold?
Does Pyllar sell digital gold?
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⚖️ Pyllar vs SafeGold ⚖️ Pyllar vs Augmont ⚖️ Gold SIP vs digital gold 📊 Gold ETF vs mutual fund vs digital gold 🥇 Gold mutual funds, explainedMutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing. Past performance is not indicative of future returns. This page describes SEBI's public statement of 8 November 2025 regarding digital gold's regulatory status as reported at the time of writing; it is not a judgement on the operational safety or trustworthiness of any specific digital gold provider, and is not investment or legal advice. Verify current regulatory status independently before making a decision.