The banks and NBFCs provide gold loans at various interest rates and for variable amounts. The monthly instalments are calculated using the Gold Loan Calculator, which the banks and NBFCs offer online. With the help of this calculator, the interest rate, amount and tenure is taken as input, and the best possible EMI is computed that suits both the parties involved.
The applicant can have multiple reasons for taking a gold loan, like paying for the child's wedding or a foreign vacation, funding abroad studies, remodelling the house, or medical bills and emergencies.
The borrower pledged a certain amount of gold in the form of jewellery, coins, biscuits or bullion as collateral with the lender, and in exchange, gets around 80% of the current value of the gold as the loan amount. Since the value of the gold is never stable and keeps fluctuating, the lenders keep a margin while issuing the gold loan amount by keeping in mind the latest trends in pricing.
The borrower pledged a certain amount of gold in the form of jewellery, coins, biscuits or bullion as collateral with the lender, and in exchange, gets around 80% of the current value of the gold as the loan amount. Since the value of the gold is never stable and keeps fluctuating, the lenders keep a margin while issuing the gold loan amount by keeping in mind the latest trends in pricing.
The gold loan approval takes only a few hours when done at the bank's branch, while it takes mere minutes to process the loan when applied online. The loan amount is different for different organisations and also depends on the quality of the pledged gold. It also depends on the LTV ratio that the bank sets while issuing the loan. It is safe to deposit the gold with the lenders as they use proper surveillance and security procedures to keep the gold ornaments safe and secure.
The following banks and NBFCs are the most renowned and trustworthy institutions that provide gold loans with multiple benefits:
- Manappuram Gold Loan - It is a Non-Banking Financial Company, a mainstay in the gold financial industry for quite some time. They have the facility of approving and issuing the loan amount within 5 minutes only. They have a bit higher gold loan interest rates because they provide multiple schemes and offers to their customers. Their loan tenure ranges from 3 months to 12 months, and the loan amount can be as high as Rs. 1 crore.
- SBI Gold Loan - It is the most prominent public sector bank in India and has branches nearly all over India. The maximum gold loan tenure is 36 months. One of the main features of SBI Gold Loan is that it offers agricultural gold loans to farmers in rural areas. New customers have to create a new account and follow the standard procedure to avail of the gold loan. The interest rate starts from just 7.50%, and the maximum loan amount is Rs. 20 Lakh.
- HDFC Gold Loan - It offers special schemes for gold loans like the Sampoorna Bharosa Gold Loan scheme. The processing time is just 45 minutes and it requires minimal documentation. The interest rates start at 10.50%, with an additional processing fee of 1.50% of the loan amount.
Some other banks and NBFCs offer gold loans at reasonable interest rates with special schemes for the underprivileged. AU Small Finance Bank Gold Loan can be availed at interest rates ranging from 12.99% to 14.99%. The loan tenure is between 3 months and 12 months. Borrowers can get an AU Small Finance Bank Gold Loan for amounts as high as Rs. 40 Lakh without showing any income proof and with minimum documents.
Conclusion: There are numerous options to choose from while looking for a gold loan. It is advisable to evaluate your options carefully and adequately so that you can get the best deal that suits your needs and does not lead you into debt. Also, go for the gold loans with renowned and trustworthy institutions only because many fraud organisations in the market try to lure customers by offering desirable deals. The best option is to keep your gold safe in the locker of the lender and repay the loan amount without any trouble.
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