Offline Gold Loan Approval Process

What is Gold Loan?

A gold loan is a loan acquired by keeping one’s gold valuables mortgage towards banks or NBFCs on the value of gold weighs as Gold Loan Per Gram. This loan is a short term secured loan involving collateral. Since 1991, bank and Non-banking Financial Institutions(NBFCs) have started lending loan on gold with less incurred interest rates. This is the only loan that can get approved in less duration of time.

Eligibility Parameters of Gold Loan: There are specific parameters specified by the lending institutions or banks which one has to abide by for availing this loan:

1. The creditor must be of legal age while submitting a loan application.

2. The creditor must be an Indian citizen.

3. A CIBIL Score of 700 or above is requested.

4. The mortgage gold should weigh above 18 carats to avail loan.

The creditor can check his/her eligibility for a loan using the eligibility calculator.

Gold Loan Schemes: There are multiple schemes given to the creditor to avail loan according to their purpose such as:

Gold Loan for Agricultural purposes: This loan can only be availed by farmers or agricultural laborer's against submitting proof of farming land. These loan purposes should be restricted to farming-related activities only. The repayment is due after the yield of crops in this loan scheme.

Gold Loan for Non-agricultural purposes: This loan can be acquired by salaried individuals, businesspeople, homemakers, self-employed individuals, traders, etc., for the purposes like wedding, home construction or renovation, travel purposes, funding education, medical emergencies or financial crisis.

Application Process: The application for a gold loan can be submitted online through the official website of ICICI or app and offline modes by visiting the nearest ICICI bank branch. The offline method is relatively better than online as there are fewer chances of error. Any wrong transactions can lead to financial loss or discrepancy. In offline, one has to visit the bank to complete the application process with required documents and thus has fewer chances of discrepancy. The bank representative will guides you through the whole loan process and solve any queries relating to it. An appointment is scheduled for gold’s purity test, and if you have mortgage gold with you, it is scheduled at that instant after completing the document verification process.

Document Verification Process: The creditor has to submit proof of genuineness where the banks request only KYC documents and two photographs. An identity proof where Aadhar card, Driving license, Voter ID, Passport and residence proof where utility bills, Aadhar card, Passport, Ration Card, Renters agreement can be submitted. A background check is conducted by bank authorities to omit the chances of fraud or forgery.

Purity Test of Gold: The most important step on which the loan approval depends is the purity test. For this test, the creditor has to visit the bank as it is conducted only on bank premises by bank authorities. The gold is assessed for its purity, and impurities present it where its weight the composition is taken into consideration. The loan amount depends on the analysis of this test as per the loan to value ratio. This test is conducted at the scheduled time where the creditor has to come along with the gold, which must be kept as a mortgage. The loan is approved in a short while after this process.

Safety of Gold: The gold is kept mortgage towards the bank by a creditor. This gold has to be analyzed before keeping it as collateral. This gold is sealed in the bag marked with a unique application number to the creditor and stored in bank lockers. The application number is the same as mentioned in the approval letter issued to the creditor on approval of the loan. The bank lockers are present inside a vault in the bank. These vaults are guarded, and security cameras are deployed inside them. The entry inside this vault is restricted only to the bank employees. The approval letter should be kept preserve by the creditor until the end of the tenure period of the ICICI Gold Loan.
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