How many of you remember when people used to say the toffee industry was killed by the rise of UPI? I hope most of you have heard of this rationale during the pandemic and after that. Earlier we used to do all transactions in cash, and for the remaining change, shopkeepers used to give us toffees. But with the rise of UPI, we haven’t witnessed such transactions in recent times. Well, the rise of anything has its own set of advantages and limitations.
May be that toffee industry has been impacted by the UPI, but there is another silent factor that we haven’t noticed, but the UPI boosted that product. Any guess? Well, the product is gold. Not physical gold, it is digital gold.
Earlier, buying gold meant saving up a few thousand rupees, walking into a jewellery shop, and then getting confused and dealing with concerns about purity, storage, and resale. But buying gold is an emotion for the middle class, but for younger generations, buying is seen as out of reach unless it is purchased during weddings or festivals. But the behavior of younger generations was completely changed by UPI.
Suddenly, anyone could buy gold with as little as ₹10 or ₹50, instantly, securely, and without the need for physical storage. Apps like PhonePe, Paytm, and Google Pay made digital gold purchases as easy as ordering groceries online. The integration of UPI’s seamless payments with gold providers like MMTC-PAMP and SafeGold gave consumers both convenience and trust.
This ease of micro-purchases is what really fuelled the boom. People no longer needed to wait for a festival to buy gold; they could build their savings gradually, one UPI transaction at a time. Just like SIPs made mutual funds popular, UPI made “micro-investing in gold” a daily habit.
We have already discussed how Jar is helping people invest in gold. But not just Jar; there are multiple players powering this wave. But most people still have the question of the quality. Digital gold isn’t “imaginary”; it is 100% backed by actual physical gold stored in secure vaults by trusted institutions (like MMTC-PAMP, SafeGold, and Augmont).
Every time you buy ₹10 or ₹10,000 worth of digital gold, the equivalent weight of 24K gold (99.9% purity) is allocated to you. But the only difference is you don’t immediately take delivery of digital gold. The gold remains in professional vaults, insured and audited regularly until you decide to redeem it. You can sell your holdings back on the app anytime and get cash instantly (via UPI/bank). Or, if you want physical gold, you can request delivery in the form of coins/bars (usually above certain minimum weights).
So compared to physical gold, it offers affordability because you can start buying gold with just 10. And it’s secured; no need to worry about storage. And these are some reasons why digital gold has gotten that attention.
To give you a better picture, let’s look at some data. Digital gold purchases via UPI reached an impressive 99.77 million transactions in August 2025, marking a substantial leap from the 20.92 million transactions recorded in April 2024. This exponential growth highlights the rapidly increasing popularity of digital gold as an investment option among Indian consumers.
The value of these purchases more than doubled during the same period, rising from ₹550 crore in April 2024 to ₹1,184 crore in August 2025. Meanwhile, the price of 24K, 1-gram gold increased roughly 44% year-on-year, from ₹7,633 to ₹11,021. This clearly indicates how people have been going crazy about the gold in the last year.
Platforms such as Jar, Paytm, PhonePe, and Google Pay have played a pivotal role in this surge, which made gold accessible to millions, including investors in Tier-2 and Tier-3 cities. The growth in digital gold transactions shows a structural shift in consumer behavior, moving from occasional, ceremonial gold purchases to micro-investing in gold as a daily habit.
And it’s not just digital gold that’s seeing a surge. Gold ETFs and mutual funds have also witnessed massive growth over the past few years. Investors, especially younger generations, are increasingly looking for diversified and convenient ways to gain exposure to gold without the challenges of physical storage or purity concerns.
Gold ETFs allow investors to trade gold on the stock exchange, just like a share, providing liquidity and transparency. Meanwhile, gold mutual funds pool money from multiple investors to buy gold or gold-related assets, offering professional management and the benefit of systematic investment plans (SIPs).
Together, these options are making gold more accessible, flexible, and attractive than ever before, allowing consumers to treat it not just as a traditional asset but as a core part of modern financial planning.
And that’s the biggest impact UPI has created on the society today. What we’re witnessing is a democratization of gold. UPI gave people the freedom to start small, invest securely, and participate in an asset that has defined wealth in India for centuries.
And UPI is a reminder that technology doesn’t just change how we spend; it changes how we save, invest, and think about wealth. Let’s see how UPI will benefit the society with its accessibility and easy convenience.
Also Read: Reliance FMCG arm to invest ₹768Cr in Andhra Pradesh food park
