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This article contains information on Gold loan, the interest rates and the service providers for this type of loan in India.

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What is Gold Loan

What is Gold Loan
As the name suggests this is the loan given against gold. Many nationalized banks, private banks and other financial companies offer this loan at attractive rates. Many go for this loan for short period to meet the requirement of their children’s education, marriage and other financial problems in the family. And others think that instead of keeping the gold idle at home or locker, loan against gold is the best option. Moreover with the rise in gold rates the demand from companies and banks offering such loans has raised. For instance, Muthoot Finance, one of the leading gold loan companies has seen 24 percent rises in gold loan against 17 percent raise in the market value of gold.  
 
Advantages of Gold Loan
  • Gold loan doesn’t demand any certificate to show your salary or income and even no credit card history is required. Thus even unemployed and non working people can go for gold loan.
  • Unlike any other unsecured loan, gold loan doesn’t require many papers, only few documents such as ID proof and address proof is enough to avail for such loan.
  • One of the main advantages of gold loan is its low interest rates. Usually loan over gold is provided at the interest of 12-16% per annum and this is quite low compared to personal loans available at interest rates of 15-26% per annum.
  • In rural areas Agricultural loan against gold is also available for agriculturist at very nominal rate of Interest of 7%-8%, proof of agricultural document needs to be provided
  • Gold loan is the most simple and convenient forms of loan because here all you need to do is pledge your gold with a bank or finance company and get upto 80% of the market value of the gold as a loan.
  • Borrower will be given an option to pay only interest during the entire term and at the end of the tenure you can pay complete borrowed amount in single shot.
  • In case of gold loan processing time is very less. Usually banks take just few hours to complete the process where as in case of NBFC’s (Non Banking Financial Companies) a few minutes is enough for the same. So for immediate financial help this is the best option. 
Charges associated with Gold Loan:
  • Loan processing charge: While some of the service providers may waiver these charges, some banks do charge a processing fee.
  • Valuation Charge: These are the charges to be paid to the valuator. These charges are also specific to the service provider and those having in-house valuators do not charge any extra amount for valuation.
  • Late payment penalty: Most of the service providers charge late payment penalty and this too can vary from one institution to the other.
  • Pre-payment penalty: Most of the service providers do not charge a penalty for repayment before the loan tenure is over. But some may still have this charge in place.
  • It is advisable to check with the loan provider before taking the loan. These charges could change the amount that you may finally receive. 
Advise On Gold Loans
  • Go for gold loan if you are confident of returning the money in time otherwise, you will be penalized and all your pledged gold will come under the control of bank or finance company.
  • While opting for gold loan check the interest rates in various banks and private finances. If you go for private lenders then better to go with one who has been in this business for many years.
  • As far as you are not emotionally linked to your gold ornaments this is the best option. However nothing like this can help you during your difficulties and with the fall of dollars and euro many think gold is the only safe thing left. 
Documents required For Gold Loan
  • Identity proof such as passport, voters ID or driving license.
  • Address proof such as electricity bill, ration card, telephone bill etc.
  • For signature proof you need to submit your passport copy, driving license or any other document with your sign.
  • 2 passport size photographs. 
Some of the leading companies and banks offering gold are ICICI bank, Muthoot Finance, Manappuram Gold Loan, SBI and HDFC.


  • ravinder singh:
    I want gold loan of about 2 lacs so what amount of gold required for that
    22-Sep-2016 06:53 PM
    • aabid: I need 5 lac rupees how much gold required for loan
      25-Sep-2016 01:07 AM
  • Darshana:
    Hi Sir,

    I need Gold loan of 2lac rupees
    Can you please help me with the following details.
    1. How many grams of gold is required?
    2. What is maximum tenure of repaying the principle?
    3. How much interest per month i have to pay?
    4. What is the late payment penalty amount?

    Thanks
    03-Aug-2016 04:54 AM
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    31-Jul-2016 12:21 PM
  • JITENDER:
    MADAM I GOT A AGRICULTURE GOLD LOAN OF RS. 1,40000 , HOW MY INTEREST WILL BE CALCULATE MEANS THE INTEREST WILL BE CALCULATE ONCE AT THE END OF YEAR OR IT WILL CALCULATE MONTHLY i.e INITIALLY ONE MONTH INTEREST WILL CALCULATE AND THEN IT WILL ADD TO PRINCIPAL AMOUNT THEN SECOND MONTH INTEREST WILL CALCULATE ON TOTAL(PRINCIPAL AMOUNT +FIRST MONTH INTEREST) AND SO ON...
    12-Jul-2016 06:00 AM
  • Rajesh.s:
    I want 65000 rs...how many gram required
    06-Jul-2016 03:29 AM
  • rammirupa@gmail.com:
    i have 14.8 grams gold how much amount you with 1.75ps interest
    05-Jul-2016 09:51 PM
  • sahish:
    30000 rs ku how much interest in iob bank
    04-Jul-2016 07:02 PM
  • rajkumar:
    need a gold loan of rs 15,000
    22-Jun-2016 06:46 AM
  • Bijma Paul:
    yes I want a loan on my gold but I Live in USA . How can you help me.
    Thanks
    Bijma Paul
    15-Jun-2016 06:58 AM
  • Ganesh:
    Hi Sir,
    I need a loan of 130000..
    Pls let me know how much grams of gold I need to pledge?
    Which bank offers the lowest interest rate?
    If I am planning to repay and take the gold back after 1 year..how much monthly interest I need to pay approximately per month ( I think principal I can pay at the last in single shot while taking the gold back)???
    So only interest only I need to pay right??

    Thanks
    Ganesh
    10-Jun-2016 06:09 PM
  • Gurpreet singh:
    Sir I want 3 lakh lone against gold plz. tel me how many gold give you
    16-May-2016 09:35 PM
  • Sasidharan K:
    Could you tell me the Government Act that regulates gold loans in Tamilnadu and Karnataka equal to the Kerala Money Lenders Act that regulates the same in Kerala State
    03-May-2016 11:21 PM
  • priti:
    I need 2 lakhs how many grams of gold is required & what is the interest rates
    24-Apr-2016 06:28 AM
  • Shailesh Pandey:
    Hi, I want Gold loan for business and I want to know about what is the different types of Gold loan are available ? And also give me the details about Gold loan.
    23-Apr-2016 03:04 PM
  • syed:
    I want Rs. 50000 loan. so how many grams of gold is required and what is the rate of interest. can i pay interest + main amount monthly if so how much can i pay ?
    14-Mar-2016 08:51 PM
  • Pranita:
    I want 5 lakhs so how much gram of gold I have to deposit
    01-Mar-2016 06:00 AM
    • Samira sahu : I need 5 lakh rupees. How much gold is needed and what is the interest rate in sbi.
      06-Nov-2016 09:01 PM
  • shashi:
    Hi I Want 1lakh loan.. I returned the amount within 3 months...Please suggest me the loan schemes and tell me the which gold loan scheme(small interest) is better for short term ...how much gold required for 1lakh amount..please answer me..
    25-Feb-2016 05:30 PM
  • shashidhar rao:
    I have a doubt if the massive difference happens in prices of gold after taking a loan what will be the situation. for example if i took gold loan on present day for one year term and by that time of year if spot gold price is so high or low what will impact on my loan. please answer im waiting. Thank you in advance for answering. -
    25-Feb-2016 05:23 PM
  • shobha:
    pl give rate of interest for gold loan for different banks ie cst
    20-Jan-2016 10:19 PM
  • udai:
    I need a loan of 2lakh? what will be the rate of interest and grams required
    13-Jan-2016 09:30 PM
  • elizah john:
    I have a account in Mumbai, and I want to take gold loan in Hyderabad, but I don't hav account in Hyderabad, Does required to hav account to have golad loan
    12-Jan-2016 07:55 PM
  • NIMISHA:
    I want Rs 500000 loan . so how many grams of gold is required and what is the rate of interest
    13-Dec-2015 04:41 AM
  • anand jadhav:
    I'm interested in agriculture loan on gold so I want some more information about this loan type so please provide information.
    31-Aug-2015 03:57 AM
  • Thomas P Antony:
    how to start a gold loan bank in Kerala,India,what are the requirements -means terms & condition.
    27-Jul-2015 06:04 PM
  • Pradeep:
    What is the lowest interest for gold loan?
    22-Apr-2015 04:26 AM
  • sarvesh tiwari:
    Provide the procedure of gold loan
    28-Jan-2015 03:56 AM
  • somnath saha:
    I need.a.loan of rs 2,00,000,fr that amount how much gold is require and wht is the interest rate.and wht r the term and condition ..pls infrm me
    19-Jan-2015 05:36 PM
  • saju oommen:
    What happens if gold pledged in bank is
    stolen??
    04-Nov-2014 05:34 PM
  • bhauso:
    I want Rs. 50000 loan. so how many grams of gold is required and what is the rate of interest?
    17-Aug-2014 09:59 PM
  • G.P.Pillai:
    What is the compound interest that you give for a particular fixed deposit ?
    18-Mar-2014 01:58 PM
  • Rinku gogoi:
    I need a loan of Rs.50,000. What will be the rate of interest? and how many gram of gold is required for that?
    30-Aug-2013 05:51 AM
  • mousumi:
    I want Rs. 50000 loan. so how many grams of gold is required and what is the rate of interest?
    13-Jul-2013 09:34 AM
    • anildagar: I want Rs 100000 loan. So how many grams of gold is requiered and what is the rate of interest?
      07-Jan-2016 10:45 AM
    • T subrahmanyam: I need Rs150000 how much gold required
      21-May-2016 02:33 AM
    • Satendra Rai: And intrest rate
      30-May-2016 01:47 PM
    • inderjeet: I whant 4lac lone how much gold I give u
      01-Jun-2016 11:36 PM
    • jyotinayan das: I want Rs. 50000 loan. so how
      many grams of gold is required
      and what is the rate of interest?
      23-Jun-2016 08:31 PM
    • Diksha: I want 80,000loan so how much gram gold is required?

      21-Jul-2016 12:08 AM
  • jayashree:
    Hai, this is a valuable information, thanks for providing this. I have a doubt if the massive difference happens in prices of gold after taking a loan what will be the situation. for example if i took gold loan on present day for one year term and by that time of year if spot gold price is so high or low what will impact on my loan. please answer im waiting. Thank you in advance for answering.
    11-Jul-2013 03:27 PM
  • savita:
    I want 3 lacs money with gold loan so how much gold required?
    07-Jul-2013 11:03 PM
    • Venkatesan : Gold loan interest rates
      18-Feb-2016 03:26 AM
    • S D SHAIKH: I want 3 lac loan against gold how much gold requied and what interest charges
      26-Apr-2016 03:07 AM
    • Sindhya: For 3lacs money how much gold i will give?
      16-May-2016 02:27 AM
    • ravinder singh: I need 3 lake loan, how much gold I require
      17-Jul-2016 11:09 PM
    • Rubysathya: I want 3lacs with gold loan.. so how much gold required
      29-Aug-2016 03:25 AM
  • atluri prasoon kumar:
    i have obtained gold loan from sbi vijayawada, i heard before taking loan that the bank will collect interest at the rate of 7% and if we paid the amount with interest within prescribed period the interest will be reduced from 7% to 4% and the interest paid by us will be deposited in to our account but i have not received till now.
    26-Jun-2013 07:48 PM
  • Kishore:
    I want 4 lacs money with agriculture gold loan in sbi so how much gold required?
    24-Jun-2013 04:11 PM
    • harsh: i want 4lac money for agriculture but i want agricultural gold loan from sbi how much gold is required and what is intrest rate in this bank.
      21-Apr-2016 02:13 PM
  • Esineni madhava rao:
    I want Rs.50000; how many grams gold is required and what is interest rate?
    22-Jun-2013 12:21 AM
  • sivamuthu:
    I need a loan of Rs.75,000. What will be the rate of interest? and how many gram of gold is required for that?
    17-Jun-2013 10:09 AM
    • Reejajoshi: I need 50000 how much grams should be there
      13-Apr-2016 02:24 AM
  • Anil Shetty:
    Hello sir,I want 1 Lac loan, what is the interest rate ? How many grams of gold is required for loan?
    15-Jun-2013 01:54 PM
    • Joe christy: I want to know about how many grams needed for one lakh at sbi
      01-Dec-2015 09:11 PM
    • rajinder singh: Interest rate 1lac pe
      30-May-2016 04:02 PM
    • sam: i want 1,50,000 rs. how many grams i have to submit and what is interest
      thanks
      20-Jun-2016 09:14 PM
  • Subhas Sinha:
    I need a loan of Rs.2 lac. How much gold is required and what is rate of interest?
    13-Jun-2013 10:58 PM
  • vikram singh:
    I need a loan of Rs. 10 lac. How much gold required and what is rate of interest?
    11-Jun-2013 03:58 PM
  • prasanna velip:
    I need a loan of Rs.50,000. What will be the rate of interest? and how many gram of gold is required for that?
    08-Jun-2013 11:35 AM
  • gohel mukesh:
    I need a loan of 2 lacs and what will be the rate of interest?? and how many gram of gold is required for that?
    25-May-2013 12:14 PM
    • Haresh Patel : I want 150000 gold loan so how much gramm gold need?
      20-Apr-2016 10:37 PM
  • sanjay kumar dutta:
    need a loan of 1 lac. what will be the rate of interest?? and how many gram of gold is required for that?
    20-May-2013 03:46 PM
    • Lubna: How many gram of gold is required for 1 lac loan
      21-Sep-2015 04:33 AM
  • arvind rajbhar:
    I need a loan of 2 lacs and what will be the rate of interest?? and how many gram of gold is required for that?
    15-May-2013 02:59 PM
  • SUHAS PATIL:
    I need a loan of 3 lac & what will be the rate of interest? and how many grams of gold is required for that?
    please reply me
    15-May-2013 11:58 AM
  • fase c.v.:
    i need 5 lakh loan. how much gold is required & what is the interest rate?
    15-May-2013 09:48 AM
  • sangam devanand more:
    if i need Rs. 50000 as loan. how much gold is required?
    12-May-2013 04:32 PM
    • kuldeep : I have 4lac rupees
      15-May-2016 12:55 PM
  • bibhusit korkora:
    Sir how much loan will i get for 25 gram gold ?
    09-May-2013 09:13 AM
  • Kiran Meruvala:
    I have 50 grams of gold with me. how much loan can i get on them?
    07-May-2013 01:21 PM