The love for gold in Indian households is world-famous. Indians consider gold as auspicious. Gold is purchased at many festivals like Dhan teras, weddings, and even birthdays. This adulation for gold makes India one of the largest consumers of gold in the world. But, with the advent of gold loans in the market, you can use this gold to avail substantial gold amounts for meeting urgent financial requirements.
Gold loan is a secured and profitable option for consumers possessing gold reserves. These loans are provided by the banks and Non-banking Financial Companies (NBFCs) for letting the consumers meet their immediate financial requirements. The loan amount is provided to the customers according to the gold loan per gram scheme. ICICI gold loan and many other banks levy charges and then give gold loan amounts against gold articles. But, the only hurdle in this process is the myths surrounding gold loans. The customer needs to understand the reality of these myths.
Myths about gold loans
Only jewelers offer gold loans - The biggest myth surrounding gold loans is that only jewelers offer it. Many banks and NBFCs offer gold loans against gold articles. It is always better to prefer banks and NBFCs for getting loans to prevent fraud. Bank provides you security and your belongings remain safe throughout the tenure.
Your gold gets exchanged - It is a common myth that your pledged gold might secretly get exchanged with fake ornaments or coins. But, actually, the banks and NBFCs keep your gold under high security in bank lockers. It will only be taken out when the loan tenure completes and is handed over to the consumer.
Gold loans come with high interest rates - A gold loan is a secured type of loan. This means that the Banks and NBFCs charge a very nominal gold loan interest rate which might range from 10.26% to 26%. Thus, availing of a gold loan is extremely feasible.
The gold loans can't be availed on old jewelry - It is a myth that you cannot get gold amounts against old and traditional jewelry. It doesn't matter whether the gold is old or new, the eligibility condition is to pledge gold which is 18 Karat or above.
Getting a gold loan is time-consuming - There is a myth that it takes a lot of time for the bank to process a gold loan. The truth is if you fulfill the eligibility criteria and have your KYC documents ready, the bank processes your loan in a maximum 1 hour.
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