January 26, 2023

Advantages of taking Gold Loan

A loan that is backed by gold is known as a gold loan. Indians can apply for gold loans to raise money because they have gold jewellery that is sitting in safe deposits. In an emergency, it is regarded as the fastest secured loan. To receive rapid funding, you must provide your loan lender with a guarantee of your gold jewellery or bank-issued coins. Typically, the loan amount is offered as 75% of the gold’s worth. Following full repayment of the loan, you will receive all the gold jewellery and coins you promised. Gold loans are offered by numerous banks and Non-Banking Financial Companies (NBFC). By visiting their bank or office in person, signing up on their websites, or downloading their mobile apps, you can use this service.

Before issuing a gold loan, lenders must complete a few procedures:

Gold submission – The lender will collect the gold from you after you have submitted an application for a loan, whether online or off. You must give the appropriate individual your gold items that you intend to pledge. If the application is offline, you must bring the gold to the lender; if it is online, lenders will come to your door to collect the things.
Gold appraisal – The lender assesses the whole value of your gold (excluding any stones or beads in the decoration) in accordance with the going rate. The amount of the loan is determined solely by the value of the gold. It may range from 75% to 85% of the whole gold value.
Documentation requirements – Along with your application form, you must provide a few documents. This is hassle-free because only a few documents, such as passport-sized photos, identity evidence, and address proof, are required.
Loan disbursement and document authentication – The lender verifies the paperwork you’ve submitted. The loan amount will be transferred to your bank account once it has been approved.

A large majority of Indians thought of gold as a valuable item because of its high monetary worth. Over the past ten years, it has experienced a sizable amount of capital growth, and in an emergency, one can easily monetize it. Because of this, more people choose gold loans than any other kind of loans.

The benefits of a gold loan are as follows:

1) Lower interest rate: Because a gold loan is secured, its interest rate is lower than that of other loans. The interest rates typically range from 11 to 16 percent.

2) Quick disbursement: Borrowing money secured by gold is safer for both the bank and the borrower. The simplest and quickest choice is the gold loan because it is backed by gold.

3) Lenders do not seek income evidence because the borrower is pledging gold as collateral. Therefore, anyone who is over 21 years old can easily obtain a gold loan.

4) Less Documentation: The gold loan doesn’t call for as many documentation as a personal loan or a mortgage. There are only two documents needed. One is proof of identity, while the other is proof of a local residence.

5) No credit check: Regardless of credit history, one can easily obtain a gold loan from any financial institution. Due to the gold being used as security, the lenders do not investigate the borrower’s credit history.

6) Lower processing costs: Processing costs for gold loans range from 0.5 to 1 percent. Banks occasionally don’t even charge it.

7) There are no additional fees: Other than late payment, foreclosure, and processing fees, there are none.

8) Gold Safety: The bank’s safe will keep your priceless item safe. As soon as you make a promise, your gold is guaranteed. Therefore, there is no reason for concern.

Banks and their rates of interest

Bank

 Interest Rates

HDFC Bank Gold Loan

7.11% – 14.50%

ICICI Gold Loan

7.11% – 16.10%

Muthoot Finance Gold Loan

7.11% – 24.00%

Axis Bank Gold Loan

7.11% – 17.11%

Manappuram Gold Loan

7.11% – 26.00%

Yes Bank Gold Loan

7.11% – 15.99%

Bank of India Gold Loan

7.11% – 26.00%

Federal Bank Gold Loan 

7.11% – 13.50%

IIFL Gold Loan

7.11% – 12.00%

Central Bank of India Gold Loan

7.11% – 14.65%

Canara Bank Gold Loan

7.11% – 12.65%

Allahabad Bank Gold Loan

7.11% – 10.45%

Induslnd Bank Gold Loan

7.11% – 15.75%

PNB Gold Loan

7.11% – 11.75%

Bajaj Finance Gold Loan

7.11% – 26%

7.11% – 15.99%

Indian Bank Gold Loan

7.11% – 15.99%

UCO Bank Gold Loan

7.11% – 26.00%

Kotak Mahindra Bank Gold Loan

7.11% – 13.50%

Syndicate Bank Gold Loan

7.11% – 12.00%

 

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