Diwali has always been a festival of prosperity and good fortune in India, marked by the tradition of buying gold coins, bars, and jewellery. For generations, people have regarded gold as a symbol of wealth and security. However, in recent years, this trend has begun to change.
Rising gold prices and the convenience of digital platforms are encouraging investors to explore newer options. These alternatives come with their own advantages, driving this transition.
Let us understand this shift, one that not only helps you stay updated with ongoing trends but also enables you to make wiser investment decisions this Diwali.
India’s Growing Gold Holdings and Wealth
India’s gold holdings continue to rise. According to Morgan Stanley, household gold, especially held by women, increased from $2.35 trillion in 2024 to $3.85 trillion in 2025. This represents significant growth, driven by rising prices and gold’s enduring reputation as a trusted store of value.
In the past 15 years, Indian women have purchased about 12,050 tonnes of gold worth Rs 52.39 lakh crore. Of this, 8,732 tonnes are in jewellery and 3,318 tonnes in coins and biscuits. Today, this gold is valued at Rs 143.20 lakh crore, generating a profit of nearly Rs 90.81 lakh crore.
Gold and silver together make up a significant 22.2% share of India’s total household wealth, second only to property. This demonstrates how deeply gold remains rooted in Indian households, not just as a symbol of tradition but also as a key component of overall wealth and long-term financial security.
Dhanteras Gold Buying Trend in India
Despite gold prices touching Rs 1,32,000 per 10 grams, up 63% from last year, and silver rising to Rs 1,80,000 per kilogram, up 55%, both metals saw robust demand this Dhanteras 2025. Gold sales volume fell by about 10–15% due to high prices, but silver demand increased significantly, especially for coins and puja items, with sales rising 35–40% year-on-year.
Higher prices led to more spending per transaction. The average ticket size grew by 20–25% as many buyers opted for lighter-weight items. Overall, silver sales surpassed gold because of its relative affordability.
A similar pattern was seen last year when gold volume dropped slightly by 5% compared to 2023, but total value increased by 15–20% as prices rose from Rs 60,750 per 10 grams in 2023 to around Rs 78,700 in 2024. Around 20–22 tonnes of gold were purchased nationwide, valued at about Rs 16,000 crore. The jewellery sector recorded total sales of Rs 18,000–20,000 crore.
Rise in Modern Instruments – Gold ETFs
In 2025, India witnessed a historic surge in gold ETF investments, with net inflows reaching around Rs 19,830 crore by the end of September, up from Rs 11,200 crore in 2024. September alone saw Rs 8,363 crore in inflows, marking a 578% jump compared to 2024 and setting a record for the highest single-month inflow.
Over the past five years, gold ETF inflows have grown at a CAGR of nearly 70%, reflecting strong and sustained investor interest.
Total assets under management for gold ETFs surged to approximately Rs 90,135 crore, a 126% rise from September 2024, highlighting their growing role in gold investments alongside physical and traditional products. Urban investors are increasingly opting for gold ETFs over physical gold due to their liquidity, ease of trading, and minimal storage concerns.
Gold Rally and ETF Performance in 2025
In 2025, gold prices in India surged sharply, with 24-carat gold reaching record levels of around Rs 1.30 lakh per 10 grams by mid-October, marking nearly a 60% year-to-date increase. This has been the strongest rally in a calendar year since 1979.
Globally, spot gold prices also rose above $4,200 per ounce, further driving domestic prices higher given India’s heavy dependence on imports.
Read Why Gold Price is Rallying
The strong performance was mirrored in gold ETFs as well. Currently, there are 22 gold ETFs in India, including four launched in 2025. Over the past year, these funds delivered an average return of 50.97%, while three-year and five-year average returns stood at 30.36% and 16.93%, respectively. This shows that both physical gold and digital investment avenues offered substantial gains for investors this year.
Rise of Digital Gold Investments
Investing in gold is rapidly shifting to digital platforms in India. Digital gold purchases through UPI grew 377% in just 16 months, rising from 20.92 million transactions in April 2024 to 99.77 million in August 2025, according to NPCI data. The total value of these purchases more than doubled from Rs 550 crore to Rs 1,184 crore during the same period.
FinTech companies such as Paytm, Google Pay, and PhonePe are leading this transformation by offering discounts and cashback rewards to attract customers toward digital gold purchases.
Among UPI transaction categories, digital gold has recorded one of the highest growth rates in both volume and value. Since entering the top 10 merchant categories in April 2024, it has steadily climbed in popularity, reflecting a clear shift in investor behaviour toward modern gold investment options.
Wrapping Up
Gold investment in India is evolving rapidly, with traditional physical purchases now coexisting alongside modern alternatives like digital gold and ETFs. While gold continues to retain its appeal as a safe-haven asset, rising prices, convenience, and liquidity are drawing investors, especially younger and tech-savvy individuals, toward digital options.
Platforms offering small-ticket investments and instant redemption have made gold more accessible and flexible, allowing investors to participate without worrying about purity checks, storage, or buyback delays.
Digital gold and ETFs are no longer niche products; they are becoming mainstream investment choices offering convenience and strong returns. This shift highlights a broader change in investor behaviour, where flexibility and ease of access increasingly influence how Indians buy gold.
*The companies mentioned in the article are for information purposes only. This is not investment advice.
*Disclaimer: Teji Mandi Disclaimer
