India jewellers have started selling gold for a little more than $1 online. The reason is ongoing pandemic. Covid has impacted the sales, pushing jewellers to reassess traditional business
practices.
After a nationwide lockdown shut stores across the country, sales in the second-largest consumer dropped last year. Apart from this, it also caused a bump in India's growing online
gold market.
Jewellers like Tanishq, Kalyan Jewellers India Ltd., PC Jeweller Ltd., and Senco Gold and Diamonds have responded by launching offers to sell gold for as little as 100 rupees ($1.35),
either directly on their websites or through partnerships with digital gold platforms. Consumers will be able to receive their gold once they have invested enough for at least 1 gram.
The offers have been introduced just as India's festival season begins, when gold demand peaks.
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Mobile wallets and platforms like Augmont Gold For All and the World Gold Council-backed SafeGold are already selling digital gold in India. Jewellers had previously avoided selling
such items online, preferring to keep them in their stores because the large proportion of sales in India are still made in person.
"Covid has shifted the mindset of many jewellers and they have been proactive in selling jewellery online as well. As a result, this is simply an extension of the whole philosophy,"
said Augmont Gold's director. The platform has almost 4,000 jewellers as partners.
Tech-Savvy generation to boost the gold sector
As more Indians become comfortable with online shopping, digital purchases are on the rise. This, combined with a younger generation of more tech-savvy consumers, is expected to boost
the sector.
According to Ramesh Kalyanaraman, executive director of Kalyan Jewellers, "we have been observing a growing interest among consumers, especially youngsters, who are keen to make
systematic investments in the yellow metal."
According to a World Gold Council report from last year- while online gold purchases, which include the sale of ornaments on jewellers' websites, accounted for only around 2% of
total sales value in 2019, the majority of these transactions were done by those under the age of 45.
According to Gaurav Mathur, founder of SafeGold, a decline in gold prices has boosted volumes on the platforms. “People think gold prices are low right now, and they're increasingly
accustomed to transacting digitally across all categories, not just gold,” he said.
"We've observed a 200 percent increase in sales on our platform since February last year, with most consumers snatching up coins and bars in the range of 3,000 to 4,000 rupees,"
Augmont Gold's Kothari said. "Buying gold in digital form has gained great popularity throughout the pandemic, and we expect sales to climb by 20% to 30% this Festive season compared to last year."