Jewellery has to be pledged with the bank or financial institution. In this, precious metals have to be given as collateral to the bank or financial institution. This is the reason why gold loan becomes a secured category loan. In this, customers have to visit banks less. Actually, in the case of gold loan, they have to go through less paperwork and the loan is issued by the bank in less time. Gold loan is a better option to arrange money immediately in case of emergency or other situation. Precious gold jewellery including gold coins can be pledged with the bank for gold loan. In this, with less paperwork, usually lower interest rates i.e. cheaper loans are available compared to other options.
Gold Loan: What is the interest rate
Banks are charging interest ranging from 8.25% to 18% on gold loans. The tenure of these loans is from 6 to 36 months i.e. half year to 3 years. Gold loan interest rates may vary in different banks. If you want to raise funds for any important work through low interest gold loan in a short time, then here you can check more information related to some major banks and the gold loans being offered by them.
Also read: Sweep-in FD: You can withdraw money from this account whenever you need, you will get interest like FD
In which bank gold loan is available at what interest rate
SBI Gold Loan (SBI Gold Loan Interest Rates)
Scheme | 1 year MCLR | Spread over 1 year MCLR | Effective Interest Rate | |
---|---|---|---|---|
EMI based on Gold Loan | 8.65% | 1.25% | 9.90% | |
3 Months Bullet Repayment Gold Loan | 8.20% (only 3 Months MCLR) | 0.55% (Spread over 3 Month MCLR) | 8.75% | |
6 Months Bullet Repayment Gold Loan | 8.55% (only 6 Months MCLR) | 0.35% (Spread over 6 Month MCLR) | 8.90% | |
12 Months Bullet Repayment Gold Loan | 8.65% | 0.50% | 9.15% |
Just like this
Bank | Rate of interest |
Bank of India | 8.80% p.a. onwards |
Canara Bank | 9.25%p.a. |
Punjab National Bank | 9.25% p.a. onwards |
IIFL Finance | 11.88%-27%p.a. |
Rupeek | 8.88% p.a. onwards |
ICICI Bank | 10% p.a. |
Axis Bank | 17%-19% p.a. |
Gold Rate in India | 0.77% per month |
Bajaj Finserv | 9.50% – 28% p.a. |
(Note – This data is taken from the website of Paisa Bazaar.com.)
Who can apply for gold loan
Any Indian citizen between the age of 18 and 75 years can apply for a gold loan in the bank. Remember, gold loan is approved against precious gold jewellery.