When stuck with a financial dilemma we often consider applying for a personal loan. But a personal loan can add on to your financial distress due to a higher rate of interest. Opting for gold loan may prove to be an affordable option in such a situation.

What is gold loan?

A system where you can get a loan by pledging your gold. Gold loans are mainly provided by banks or NBFC’s wherein the purity of the golf should be 18-24 carats.

Why avail a gold loan?

• Low interest rate: In the case of a gold loan, physical gold is kept as collateral, allowing you to avail a lower interest rate. Additionally, loan processing takes less time.


• No credit history: For a gold loan, only the gold collateral matters; banks do not require employment status, income proof, or credit history for sanctioning the loan.


• High margin: Lenders typically provide up to 75% of the value of the gold pledged for the loan.


• Easy repayment: You can pay only the interest amount during the loan tenure, with the principal paid in a lump sum at the end.

Key features of gold loan:

• Physical gold ornaments and gold bullion are accepted as collateral
• A gold loan can be easily availed by anyone with gold
• The loans are quickly processed, often sanctioned within an hour
• It comes with a highly flexible tenure based on the loan amount
• Interest rates range from 10.5% to 16%, with a processing fee of 2%