Gold and Silver ETF Rules Change From April 1: SEBI's New Framework

SEBI Overhauls Gold and Silver ETF Rules

The Securities and Exchange Board of India (SEBI) has announced significant changes to the regulatory framework governing Gold ETFs and Silver ETFs, effective from April 1, 2026. These changes aim to increase transparency, reduce costs, and give investors better protection.

Key Changes in the New SEBI Framework

1. Multi-Asset Allocation Relaxation

SEBI has allowed multi-asset allocation funds to invest up to 35% of their portfolio in gold and silver ETFs (up from the previous 25% limit). This means:

• More mutual fund categories can now hold higher gold/silver exposure
• Fund managers have greater flexibility to increase gold allocation during uncertain times
• Investors in multi-asset funds automatically get better diversification into precious metals

2. Stricter Disclosure Norms

Gold and Silver ETF schemes must now disclose:

• Physical metal holdings — exact weight and purity
• Custodian details — where the metal is stored
• Tracking error — how closely the ETF follows actual prices
• Monthly portfolio reports with more detailed breakdowns

3. Expense Ratio Caps

Fund Size (AUM)	Previous Max TER	New Max TER
Up to ₹500 crore	1.00%	0.50%
₹500-5,000 crore	0.80%	0.35%
Above ₹5,000 crore	0.60%	0.20%

Lower expense ratios mean more of your money works for you instead of going to the fund house as fees.

4. Direct Metal Purchase Option

SEBI is exploring allowing ETF unit holders to take physical delivery of gold against their ETF units. While details are still being finalized, this could bridge the gap between paper gold and physical gold.

How Does This Affect Your Gold Investments?

If You Already Own Gold ETFs

Good news — your costs are coming down. Lower expense ratios mean better returns. No action needed; changes apply automatically.

Gold ETF vs SGB: Narrowing Gap

With SGBs losing their tax-free maturity benefit from April 2026 and Gold ETFs becoming cheaper, the gap is narrowing. Gold ETFs now offer:

• Lower costs (0.2-0.5% TER vs earlier 0.6-1%)
• Higher liquidity (trade anytime on stock exchange)
• No lock-in period
• Same LTCG tax treatment as SGBs now

Top Gold and Silver ETFs in India (March 2026)

ETF Name	AUM (₹ Cr)	1-Year Return	Expense Ratio
Nippon India Gold ETF	3,500+	18.2%	0.35%
HDFC Gold ETF	2,800+	17.9%	0.30%
SBI Gold ETF	2,500+	17.7%	0.40%
ICICI Silver ETF	1,200+	22.5%	0.45%
Nippon Silver ETF	900+	21.8%	0.40%

Use our Lumpsum Calculator to estimate how much your gold or silver ETF investment could grow.

The Bottom Line

SEBI's new framework makes Gold and Silver ETFs more investor-friendly with lower costs, better transparency, and wider availability through multi-asset funds. If you have been considering adding precious metals to your portfolio, the new rules make ETFs an increasingly attractive option.

Disclaimer: This article is for educational purposes only and does not constitute financial advice. Please consult a qualified financial advisor before making investment decisions.