The repayment options available with various lenders should be checked and you should choose a lender who offers flexible repayment options.
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New Delhi: One of the easiest and fastest ways to get a loan is to use gold as collateral. However, people do have concerns that their gold may be at risk if used as a collateral. But organised sector lenders will ensure that you receive your gold in its exact same purity once you have fully repaid the loan. Gold in any form, be it jewellery, coins, et cetera, can be used as collateral for taking loans.
Factors To Be Considered While Taking Gold Loan
Interest rate: You have to check the interest rates of different lenders, and compare them to find the lowest interest rate so that you can get best value of your gold.
Loan-to-value (LTV) ratio: LTV ratio is the maximum amount of loan you can get against the value of your gold. Check the LTV ratio of different lenders and choose a lender who offers a higher LTV ratio.
Processing fees: You have to check the processing fees of various lenders, and choose a lender who charges a lower processing fee.
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Repayment options: The repayment options available with various lenders should be checked and you should choose a lender who offers flexible repayment options.
Lender’s Credibility: Rather than going to the unorganised sector lenders, it’s always advised to approach a lender from the organised sector background, that is, somebody who is accountable to the government and the central bank and ultimately, the people.
What mentioned above are some tips you should consider while taking a gold loan. Now let’s look at the comparison* of the gold loan interest rates in 2023. The repayment tenure in the chart below has been taken as six months and the purity of the gold as 22-carat.
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| Name of the Bank | Interest Rate | Loan Amount |
| Axis Bank Gold Loan | 13.50% p.a.to 16.95% p.a. | Rs.25,001 to Rs.25 lakh |
| HDFC Gold Loan | 11% p.a. to 16% p.a. | Rs.10,000 onwards |
| Canara Bank Gold Loan | 7.35% p.a. | Rs.5,000 to Rs.35 lakh |
| Muthoot Gold Loan | 12% p.a. to 26% p.a. | Rs.1,500 onwards |
| SBI Gold Loan | 7.00% p.a. onwards | Rs.20,000 to Rs.50 lakh |
| Kotak Mahindra Gold Loan | 10.00% p.a. – 17.00% p.a. | Rs.20,000 to Rs.1.5 crore |
| IndusInd Bank Gold Loan | 11.50% p.a. – 16.00% p.a. | Up to Rs.10 lakh |
| Manappuram Gold Loan | 9.90% p.a. to 24.00% p.a. | As per the requirement of the scheme |
| Bank of Maharashtra Gold Loan | 7.10% p.a. | Up to Rs.20 lakh |
| PNB Gold Loan | 7.70% p.a. to 8.75% p.a. | Rs.25,000 to Rs.10 lakh |
| Bank of Baroda Gold Loan | 8.85% p.a. onwards | Up to Rs.50 lakh |
