Flipkart-owned payments app PhonePe on Wednesday announced the launch of its Gold category, allowing users to buy and sell certified 24 karat gold on the app.
Like Paytm, PhonePe will offer customers the opportunity to buy gold for amounts as low as Re 1. According to the company, customers can create a PhonePe Gold account on the app, and monitor live Gold prices to make purchases at transparent prices. All gold prices will be linked with rates in the commercial bullion market, with every rupee collected from customers used to purchase physical 24 karat gold.
To launch this product, PhonePe has partnered with SafeGold. IDBI Trusteeship Services will act as the trustee bank, guaranteeing the gold holdings of the consumer.
According to the statement, gold purchased on PhonePe is physically deposited into a vault, and will be fully insured. If a customer needs physical gold, they can ask for it to be delivered to their doorstep. SafeGold will deliver gold coins that are independently Assay Certified for purity, and delivered in tamper proof packaging.
Commenting on the launch, Hemant Gala, Head of Bank Relations & Strategic Partnerships, PhonePe said,
“We are thrilled to announce the launch of PhonePe Gold. Now millions of PhonePe customers will be able to buy 24-karat gold securely at the click of a button. Best of all, thanks to our strategic partnership with SafeGold, we are not just selling digital gold. We are selling real physical gold that can be delivered to consumers when and where they need it.”
Gaurav Mathur, Managing Director of SafeGold, "Online purchase of Gold is still a nascent, yet fast-growing market in India. We believe our exclusive online partnership with PhonePe will help us in accelerating the pace of online sales of gold in India. The focus is on driving mass adoption at affordable ticket sizes. The SafeGold structure is in line with global best practices that puts a premium on protecting consumer interests. In partnership with PhonePe we will introduce products, which will make it easier for Indian consumers to accumulate wealth.”
In July, Paytm launched Paytm Gold in partnership with MMTC-PAMP, a joint venture between PAMP Switzerland and the Government of India undertaking MMTC Ltd. Paytm gold is stored in what MMTC-PAMP says are its 100 percent secure insured lockers.
Krishna Hegde, Senior Vice President, Paytm said that in July, 175 kg gold had been bought on the Paytm Gold platform. The concept has gained popularity in Tier II cities like Kanchipuram, Thane and Ahmedabad, besides Bengaluru and Hyderabad.
On the lunch of PhonePe's gold product, Subrat Udgata, Vice-President, IDBI Trusteeship Services said,
"Gold has always been a prized possession in India. We are delighted that an innovative company like PhonePe, in partnership with SafeGold, is offering customers a convenient and secure way to buy or accumulate the best quality gold. It is noteworthy that there are independent entities in this partnership protecting the customer's interest at all stages. We are actively supporting such innovative digital business models as Trustees and the SafeGold-PhonePe partnership is an example of that effort."
Earlier this month, PhonePe said it processed over one million transactions, worth over Rs 100 crore, daily in the month of November.
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.