Exploring How Goldpe's Prize-Linked Savings Model Is Transforming The Investment Landscape In India

How GoldPe's Prize-Linked Savings Model Is Transforming the Investment Landscape in India


In April 2023, GoldPe was launched with the goal of revolutionizing the way Indians save, providing a rewarding yet secure experience. The investment tech startup enables users to invest in digital gold with as little as INR 10 and presents an opportunity to win up to INR 10 Lakh every week with a purchase of digital gold worth INR 100 or more.

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Operating in the investment tech sector, the startup taps into a market expected to reach $74 billion by 2030, marking significant growth from $9.2 billion in 2022.



People are changing the way they save money, moving away from the usual methods. This shift is happening because Indians are exploring different ways to invest, looking for better returns compared to traditional options like Fixed Deposits (FDs), Recurring Deposits (RDs), and gold.



Yet, the challenge lies in discovering Indian fintech platforms that strike a balance between secure investment options and enticing rewards. Such platforms are relatively rare in an investment landscape often marked by either low-risk, low-return choices or high-risk, high-return ventures.


In an effort to cater to this underserved market, Parth Shah and Yaagni Raolji, based in Ahmedabad, introduced the fintech startup GoldPe. This platform enables users to invest in digital gold with as little as INR 10 and provides a chance to win up to INR 10 Lakh every week upon purchasing digital gold worth INR 100 or more.


Launched in April 2023, GoldPe aims to "revolutionize the way Indians save" by making it a rewarding yet secure experience, as stated on the company's website.


But there's more to GoldPe than just being an investment platform. It serves as a remedy to the growing issue of fantasy apps that frequently land people in debt. Users keep losing money, holding onto the dream of hitting a big jackpot someday.


According to Shah, speaking with Inc42, "Through the GoldPe app, users can develop the habit of saving with the potential for significant rewards, all while enjoying superior economic value compared to traditional savings avenues. Even without a prize, users' funds accumulate over time, providing a path to financial growth."


As of now, the startup boasts a user base of 2.25 lakh individuals who have invested in digital gold through GoldPe, actively taking advantage of the startup's prize-linked savings (PLS) offering. Since its inception, the company has served approximately 55,000 winners.


The growing presence of fintech startups in India is a significant factor in this change. Companies like Zerodha and Groww have made it easy for Indians to tap into the more dynamic stock market for potential higher returns. On the other hand, platforms like Jar and Gullak are providing safer but less lucrative saving options.


The beginning of GoldPe



Before creating GoldPe, Shah and Raolji initiated a personal finance management (PFM) app called SPAC in 2022. Despite securing INR 71 Lakh in funding from 100X.VC and a group of angel investors within the same year, SPAC had to shut down in May 2023. It struggled to compete with well-established players such as ETMoney, Fisdom, and Moneysights, managing only 10,000 downloads during its 1.5-year existence.

As the founders pondered their next steps, Shah reminisced about his childhood in Kuwait. During that time, his father would stash savings in Kuwait's Gulf Bank, enticing customers with a lottery known as AlDanah Millionaire draws.​​​​​​​

This idea, also known as a prize-linked savings scheme, is prevalent in the UK, the USA, and the Middle East. In this scheme, users usually deposit money into a Prize-Linked Savings (PLS) account at a regulated bank.With every deposit, they gain entries into regular cash prize draws, much like a lottery but conducted exclusively by financial institutions to maintain legal compliance.


"As a new startup, our goal was to eliminate all the obstacles for conducting business seamlessly. The primary reason we opted for gold was due to minimal compliance requirements, allowing users to start saving without the need for any KYC. Moreover, there's no limit on investments. With us, individuals can even invest as little as INR 10 to purchase digital gold," explained Shah.


The fixed returns resulting from gold price fluctuations are unrelated to the winnings. Shah acknowledged the role of startups like Jar and Gullak in educating people about the potential of digital gold, fostering trust in the asset.

Moving forward, users have the flexibility to invest as little as INR 100 to partake in weekly lucky draws — and yes, you still retain ownership of your gold.Every ticket includes six numbers, and GoldPe unveils one digit daily over six days, usually announcing the winners on Saturdays.The company claims to have sold over 10 million tickets. GoldPe earns a 3% commission from Augmont on each transaction, and the startup replenishes the pot using 1%




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