Gold Loan
Gold Loan Basics: Read This Before Pledging Your Gold
Gold prices have crossed 50,000 for every 10 grams. This is the highest ever price of Gold in India. Hence it’s safe to say that Gold is quite desirable among Indians whether it’s for investment, weddings, savings, or any other reason.
With rising expenses and low income, it is getting difficult for Indians to survive in this falling economy. If there is a medical case in the house, expenses can go up in lakhs. In such a time, Gold loans are the best solution for you. To make you understand better, we have created a list of FAQs that we will answer.
Gold Loan
The meaning of a gold loan is a secured loan taken by borrowers seeking to meet their immediate or long-term cash demands against gold. Lenders typically approve you for a loan in an amount that corresponds to a particular portion of the gold’s value. You can receive your gold items back after paying them back in monthly installments. In this case, the borrower guarantees their gold jewellery as security. According to the Reserve Bank of India, the amount of the loan allowed may not exceed 90% of the gold’s current market value. The gold that can be pledged ranges in carat weight from 22 to 24.
Thus, it’s a terrific option to meet your urgent financial demand, whether it’s for a wedding, a family trip, or your child’s school. In addition, many commercial and nationalised banks as well as NBFCs provide gold loans at low-interest rates.
Things to Keep in Mind while Selecting the Best Banks for your Gold Loan Requirements
1. SBI Gold Loan
SBI Gold Loan is offered with loan amount up to Rs.50 lakh and interest rate going up to 7.30% p.a. The repayment tenure is up to 3 years with processing fee charged at 0.50% of the loan amount.
| Interest Rate | Up to 7.30% p.a. onwards |
| Loan Amount | Up to Rs.50 lakh |
| Loan Tenure | Up to 3 years |
| Processing Fee | 0.50% of the loan amount + GST subject to a minimum of Rs.500 |
2. Bank of Baroda Gold Loan
If someone needs money right away, they can apply for a Bank of Baroda Gold Loan by offering their own gold, jewellery, or coins as security. With rapid processing and disbursal, the Bank of Baroda offers gold loans at an interest rate of 8.85% + SP and higher. Gold-based security or collateral is safely returned upon timely and complete repayment of the loan amount.
| Bank of Baroda Gold Loan Interest Rate | 8.85% |
| Loan Amounts | Up to Rs. 50 lakhs |
| Age | 18 Years – 75 Years |
| Tenures | 1 Year |
| Accepted Gold | Banks sell ornaments, jewellery, and specially struck gold coins (Min. 18 K gold) |
| Processing Fees | Rs. 25 per lakh + GST |
3. HDFC Bank Gold Loan
All fixed rate loans up-to Rs 50 lacs, availed by Micro and Small Enterprises, will not be charged with foreclosure and Prepayment charges provided the same has been closed/part paid from own source of funds
| Rates offered to customer during the period of Jan’24- Mar’24* | |||
| Product Group | Bank IRR | ||
| Min | Max | Avg | |
| GOLD LOAN | 9.00% | 17.65% | 11.98% |
| Annual Percentage Rate offered to customer during the period of Jan’24- Mar’24* | |||
| Product Group | Bank APR | ||
| Min | Max | Avg | |
| GOLD LOAN | 9.00% | 17.67% | 11.98% |
4. Axis Bank Gold Loan
Gold Loan interest rate is the rate at which a financial institution lends money against the value of gold provided as collateral. This rate typically varies depending on factors such as the lender’s policies, prevailing market conditions and the loan-to-value ratio. Generally, Gold Loan interest rates tend to be lower compared to interest rates on other loans owing to the reduced risk associated with gold collateral.
| Fixed Rate Loan | 1 year MCLR | Spread over 1 year MCLR | Effective Interest Rate | Reset | |||
| Gold Loan | 9.35% | 7.65% | 17% | No Reset | |||
5. Bajaj Finserve Bank Gold Loan
Know about the current gold loan interest rate and learn about the charges applicable before you apply for our gold loan.
| Types of fee | Applicable charges |
| Interest rate | 9.50% to 28% per annum |
| Processing fees | 0.15% of the loan amount (inclusive of applicable taxes). Subject to a minimum Rs. 99 (inclusive of applicable taxes) and maximum of Rs. 600 (inclusive of applicable taxes). |
| Stamp duty (as per respective state) | Payable as per state laws and deducted upfront from loan amount |
| Cash handling charges | Rs. 50/- (inclusive of applicable taxes). Applicable for cash disbursement only. |
| Penal charge | Rs. 8 per day on Outstanding Balance – Penal charge will be over and above the interest rate slab mentioned above which shall be applicable/chargeable in case of default in repayment of the Outstanding Dues post maturity. |
| Convenience fee | Convenience fee of Rs. 149 (inclusive of applicable taxes) shall be levied for release of ornament/s out of multiple ornaments securing the Gold Loan. |
| Part-prepayment charges | NIL |
| Foreclosure charges | Foreclosure charges are “0”, but in cases the Borrower closes the loan, interest on a pro-rated basis will be applicable. |
| Auction charges | Charge for physical notice – Rs. 40/- (inclusive of applicable taxes) per notice Recovery charges – Rs. 500/- (inclusive of applicable taxes) Advertisement fee – Rs. 200/- (inclusive of applicable taxes) |