Lenders Law

Prize-Linked Savings Accounts (PLS accounts), also known as  lottery-linked deposit accounts , are an innovative financial product designed to encourage savings by combining the  security of a traditional savings account  with the  excitement of a lottery-style reward . Instead of offering higher interest rates, these accounts provide depositors with a chance to win cash prizes—without risking their principal. Globally, PLS schemes have been used as a tool for  financial inclusion , particularly to attract individuals who may otherwise remain outside the formal banking system. However, their compatibility with India’s regulatory framework raises important legal and policy questions. What Are Prize-Linked Savings Accounts? A prize-linked savings account offers depositors an opportunity to participate in periodic prize draws based on the amount they save. The core idea is simple: Depositors place money into a savings account. Each qualifying deposit ...

On 8 November 2025, the Securities and Exchange Board of India (SEBI) issued a strong cautionary advisory warning the public about the risks associated with Digital Gold/ E-Gold products offered on various digital platforms. This warning arrives at a time when fintech ecosystems are aggressively promoting digital gold through festive campaigns, ₹1 gold sales, jackpot offers, and even celebrity- driven, game show inspired advertisements . This widening gap between regulatory reality and advertising-driven perception demands a public conversation. 1. What SEBI Has Clarified: SEBI emphasizes that digital gold products: Not a security under the Securities Contracts Regulation Act (SCRA); Not a commodity derivative under the SEBI Act; Not an Electronic Gold Receipts (EGR) or Exchange Traded Funds (ETF) under relevant SEBI frameworks; Not issued by a government or regulated financial intermediary; SEBI has no jurisdiction over digital-gold issuers or platforms. This creates a regu...