More UAE investors are 'buying' gold from Dh200/Dh250 - and getting good returns

Dubai: For UAE gold buyers who feel they are being priced out by what’s happening in the last 6 months, there are other options opening up for them.

And they can start investing in gold from as little as Dh250 a month, whether through trading apps, UAE jewellery retailers – or even some of the biggest banks in the UAE. All this when gold prices are ruling at Dh360-Dh380 a gram for 22K in recent months.

This is where ‘fractional ownership’ or ‘tokenization’ comes in. The whole purpose is to allow even traditional gold buyers to think of alternate ways to put in their money into their favourite asset.

Fractional buying is just what it says – investors get to buy a ‘part’ of a certain weight of gold, whether it’s a 1 kilogram bar or any other option.  

In recent weeks, investing in gold on a fractional basis at Dh200-Dh250 a month or spending a minimum Dh2,000 on a property in Dubai on a tokenization basis is one of the biggest trends among UAE residents.  

“You don't have to buy a lot of gold under fractional - you can ‘I want to start investing Dh250 a month and just keep purchasing equivalent gold,” said Raheel Ahmed, CEO of RAKBank. “It just keeps accumulating. The more wealthy customers want to buy for investment purposes, while others do so as savings. It's much more convenient - it's safer, easier to manage and works well.”

RAKBank added between 7,000-8,000 new customers for its fractional gold investing feature, done through its app. And when the customer wants to cash in, they can do so instantly.

"We’re seeing significant investor appetite (for tokenization) across various real-world assets (RWAs), including (for) gold, art, and fund structures," said Farbod Sadeghian, founder of TheBlock, which is an international chamber of virtual assets based in Dubai. "Tokenisation enables access to traditionally illiquid or exclusive assets, and this trend is growing rapidly."

In the last six months, gold has moved ever higher – and UAE investors need just one detail to tell the story. Back in October 2024, the Dubai gold price crossed Dh300 for the first time.

Look up the price for a 22K gram today, and it’s over Dh380. During this period, UAE jewellery demand has dropped significantly.

This is where alternate investments are featuring in a big way with UAE investors.

“Our fractional gold investment was introduced a couple of years ago, but I think it really picked up in the last 6- to 8 months,” said Ahmed.