Why gold loan is the best option for finance?

After this global pandemic, our country’s economy got broke as all small to big businesses were shut for more than the time period of 3 months. After the month of September country’s economy started coming on track but to bring on track small to big business owners needed funds as they didn’t earn anything for more than 3 months and had to spend their savings during the time of lockdown. So, to arrange the funds different people took different options. But after the pandemic, it has seen that the gold loans market got an instant rise. As gold is the symbol of prosperity in Indian households. People who want to do investments mainly do investments in gold and property As it is a well-known fact that both gold and property prices keep on rising in India. So, most people of India invest in gold. That is the main reason that India is the country which is the largest consumer and importer of gold. 

To bring their financial position on track many people adapted the option of loans. There are many types of loans available in the market offer by different banks and NBFCs like SBI, ICICI, Muthoot Finance Gold loan, etc. But every loan has the eventual motive to fulfill. Like if you will take a house loan then you will have to buy a house and that house will be collateral with the bank until you will not repay your loan amount as a whole.

But there are two types of loans available in the market which don’t tell you how you should use your loan amount i.e. you can use those two loan amounts wherever and whenever you want. Those two loans are gold loans and personal loans. Personal loans are the type of unsecured loan i.e. you don’t have to pledge any collateral to apply for a personal loan. Gold loans are the type of secured loan i.e. you need to pledge your gold to apply for a gold loan. Now you must be thinking, that why not apply for a loan where you don’t need to pledge any collateral instead of a loan where you need to pledge the collateral. 

The reasons to apply for a gold loan instead of a personal loan:

• Lower rate of interest in comparison to any other type of loan.
• Less documentation required to apply for a gold loan.
• Take less time to get approved and disbursed in comparison to any other loan
• Flexible loan tenures are available.
• Flexible repayment methods are available to repay the loan.
• No credit score is required to apply for a gold loan but to apply for a personal loan you need a higher credit score.