Introduction
On 4th May 2026, the National Stock Exchange of India (NSE) introduced Electronic Gold Receipts (EGR), marking a new chapter in how India invests in gold.
For decades, gold investing meant buying jewellery, coins, or bars. Then came digital formats like ETFs and digital gold. But, then, in Nov 2025, concerns with digital gold arose.
Now, EGR brings the best of both worlds.
To know more about EGRs, keep reading this blog, as we explore what Electronic Gold Receipts (EGR) are, how they work, their key features, and how you can start investing in gold.
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What is Electronic Gold Receipt (EGR)?
Electronic Gold Receipt (EGR) is a exchanged-traded securities that represents ownership of physical gold stored in secure, SEBI-approved vaults. It was first launched by BSE in 2022, during Muhurat Trading in Diwali.
Instead of holding gold in physical form, investors can buy and sell EGRs on stock exchanges (just like shares), making gold investment in India more convenient and transparent.
Each EGR is backed by actual gold of standard purity, ensuring safety and trust. Investors also have the option to convert EGR into physical gold if needed.
How Electronic Gold Receipts (EGR) Work?
Electronic Gold Receipts (EGR) follow a simple three-step process: Creation → Trading → Conversion.
Here’s how EGR works (as per SEBI framework):
1. Creation of EGR
Initially, Physical gold is deposited in SEBI-approved vaults through accredited refineries or imports.
Later on;
- A vault manager verifies purity and quantity (as per standard gold norms).
- Once verified, an Electronic Gold Receipt (EGR) is created.
- The EGR is credited to the investor’s demat account.
2. Trading on Stock Exchange
Once created, EGRs are then listed and traded on exchanges like the NSE and BSE. Investors can buy and sell EGRs like shares during market hours.
EGR trades are settled through clearing corporations, ensuring smooth transactions.
3. Conversion into Physical Gold
Investors can redeem their EGRs anytime by requesting delivery. This request is only valid for 3 days, which collapses, likewise.
The corresponding EGR is extinguished, and physical gold is withdrawn from the vault. A person can withdrawal of EGR gold only between 10:00 AM to 03:00 PM, processed on same working day.
This structure ensures that every EGR is backed by actual gold, making it a secure and efficient form of digital gold investment.
Key Features of Electronic Gold Receipts
Here’s why Electronic Gold Receipts are different from traditional Gold ETFs or SGB:
| Category | Details |
| Regulator | Securities and Exchange Board of India (SEBI) |
| Segment | EGR segment on National Stock Exchange of India (NSE) |
| Asset Class | Securities under SCRA, 1956 |
| Ecosystem | SEBI, Exchanges, Clearing Corporations, Depositories, Vault Managers |
| Trading | Buy/sell like shares on stock exchange |
| Settlement | T+1 cycle |
| Depositories | Hold EGR in demat & manage settlement |
| Vault Managers | Handle gold deposit, storage & withdrawal |
| Market Timings | Mon–Fri: 9:00 AM to 11:30 PM / 11:55 PM* |
| Margin | VaR + ELM + MTM |
| Participants | Retail investors, jewellers, traders, refineries |
| Product Options | Multiple units (1kg to 100mg) in 999 & 995 purity |
EGR vs Physical Gold vs Gold ETFs
EGRs are exchange-traded digital receipts backed by physical gold, offering both liquidity and optional physical delivery. Physical gold gives direct ownership but involves storage and making charges. Gold ETFs are market-linked investment funds that track gold prices but do not offer physical delivery.
Here are the key differences between Gold EGR vs Physical Gold vs Gold ETFs
| Electronic Gold Receipts (EGR) | Physical Gold | Gold ETFs | |
| Form | Digital (demat) | Physical (jewellery, coins, bars) | Digital (fund units) |
| Backing | Backed by physical gold in vaults | Direct ownership of gold | Tracks gold prices (no direct ownership) |
| Trading | Traded on the NSE and BSE | Not exchange-traded | Traded on stock exchanges |
| Minimum Investment | Flexible (small units like grams) | Higher (depends on form) | Flexible (1 unit onwards) |
| Physical Delivery | Yes (on request) | Already physical | No |
| Liquidity | High | Low to moderate | High |
| Storage | Stored in SEBI-approved vaults | Self-storage required | Managed by AMC |
| Costs | Storage & transaction charges | Making charges, storage cost | Expense ratio |
| Safety | High (regulated by Securities and Exchange Board of India) | Risk of theft/storage issues | High (regulated market) |
Taxation of Gold EGR in India
As per 2023 tax rules, if the physical gold is converted to Electronic Gold Receipts (EGR) or vice versa, there would be no capital gain tax charged to the investor.
However, note that, capital gain tax is only applicable on redemption. So, if a person books gains on EGR, he/she has to pay capital gains on the actual cost paid for buying the physical gold.
Conclusion: Should One Invest in EGR?
Electronic Gold Receipts (EGR) offer a simple and smart way to invest in gold, giving you the safety of physical gold without the hassle of storing it. Since they trade on exchanges, you also get better liquidity and price transparency compared to traditional gold.
But, there’s a catch.
While EGR is still a relatively new concept, its regulated setup could sound like a promising option for gold investment in India. But, there are pros and cons too.
Just make sure to check the latest details on the National Stock Exchange of India before you
Source
SEBI | Master Circular for Electronic Gold Receipts (EGRs)
