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People nowadays opt for a gold loan as it is accessible quickly at low rates of interest than that of the Pawn Brokers. Gold loans are available by securing gold ornaments or Bank coins to a Bank or Financial Institution. The gold articles or jewellery pledged are protected with the bank and are paid back to the customers after the loan proportion is indemnified. For gold loans of Rs 25 lacs or more ITR and PAN card of the applicant is a must. And if the applicants’ annual income exceeds Rs 5 lakhs as per the Regulatory Guidelines, the Permanent Account Number or PAN card is compulsory. Any Indian citizen who attains the age of majority is competent to get a gold loan and required to furnish all essential documents to get the loan. In June 2021, Rs 4621 was the loftiest rate of Gold Loan Per Gram. According to the reports of the Reserve Bank of India, the aggregate loan disbursed by the commercial banks in India was almost Rs 21,645 crore till the second week of October. On 11th October the amount went up to Rs 97.9 lakh crore. The growth of gold loans also remained tepid till October 11. The credit growth on a year on year basis also dropped from 14.4% to 8.8%. Gold loan companies at times show meagre gain but remain stable due to the increasing price of gold in the Investment market.

A loan Mela announced by the government for 9 days in 250 districts across the whole country, was basically arranged to strengthen the consumption and to restore the demand for loans among the people. This Loan Mela was hit, and Rs 81,781 crore was disbursed by State-run banks within October 1-9 as announced by the Finance Secretary at a media conference in October. Gold rates and loan to value better known as LTV, have gone down by 16% and in the last quarter, there was barely any growth registered. Even there is a decline in portfolio around 4 to 5% but the underline collateral remains steady. The gold loan demand is pretty good and new customer acquisition is also steady. The gold loan business is doing satisfactorily, except 7 to 8% provisions in MFI. In India, nearly every bank delivers gold loans to their customers with interest rates varying from 7.35% to 12.5% and the lowest processing charges.

A Comprehensive Comparison Of Gold Loan Interest Rates In Various Banks Are Given Below:-

1. Punjab National Bank:- Punjab National Bank delivers a gold loan @8.75% for 12 months and the processing charges are 0.7% of the loan amount borrowed plus taxes.
   
   
2. ICICI Bank:- ICICI Gold Loan offers gold loan @9% for 12 months and the processing fees is only 1% of the loan amount. The bank offers no foreclosure charges with a very transparent application process.
   
   
3. HDFC Bank:- HDFC gives gold loan @ 9.5% for 24 months with 1% of the loan amount as processing charges.
   
   
4. Manappuram Bank:- Manappuram Finance provides a loan @9.9% for 3 months with Rs 10 processing fees to be paid at the time of settlement of the loan.
   
   Several alternatives are available to the applicants of gold loan to choose from according to their requirements and budget. Gold loans are risky as there are possibilities of the gold will be forfeited if timely the loan is not paid back so prior planning is a must before opting for the same.

Must Read:- Is Gold Loan Secured? 

Gold loan is one the safest loan. Most people believe in investing in gold as it can be used as a precious asset in financial emergencies. Gold loan calculator is an important tool that can help the borrower calculate the loan amount availed from the bank or non-banking financing companies(NBFCs). The borrower can easily apply for a gold loan all around India from any banks or financing companies. An applicant always recommends applying for a gold loan at a verified financing company to avoid any loss. 

Canara bank gold loan can be applied online from the bank’s website or offline by visiting the bank’s nearest branch. The bank offers various repayment options which a user can select as per the convenience. The bank also provides several schemes on gold loans. For more information regarding the gold loan, one can check the official website of the bank. 

Gold loans can be used for down payments very conveniently. A gold loan is not a fixed loan and can be easily used for various purposes. One can conveniently avail of a gold loan for down payment purposes. 

The various advantages of taking a gold loan are listed below:- 

• High loan value:- Gold loan has a very high loan value. One can quickly get a loan of upto 20 lakh. Many banks and non-banking financing companies(NBFCs) provide loan upto 20 lakh on gold loans after evaluating the gold ornaments provided to the lender. The loan value depends on the amount of gold ornaments given to the bank and the purity of the gold. One can easily take a gold loan in times of emergencies as the loan value is high.
  
  
• Prepayment and foreclosure facilities:- Many banks provide prepayment and foreclosure facilities on the gold loan. One can easily prepay the loan. The foreclosure charges are very minimal in gold loans. The facility can be avail easily when needed. Prepaying your loan can help you in decreasing your burden. It is always recommended to prepay the money if possible by the borrower.
  
  
• Safety of the gold:- The banks and non-banking financing companies(NBFCs) provide full safety of the loan. The gold submitted by the borrower is kept at the secured locker at the bank. An applicant need not worry about the security of the gold ornaments submitted to the bank. After the successful repayment of the loan to the lender, the gold ornaments are returned safely.
  
  
• Flexible tenure:- The tenure provided on the gold loan is quite flexible. A borrower can choose the preferred tenure as per the convenience. Choosing the right tenure is very much crucial while availing of the gold loan. The shorter the loan tenure, the lesser the interest rate charged. It is always recommended for the applicant to choose a shorter tenure to avoid extra losses. Moreover, An applicant should choose the preferred tenure as per the convenience to avoid any future debt.
   
  
• Additional schemes:- one can avail gold loan and can get additional schemes. The additional schemes offered by the bank can help the applicant in saving money. Various banks and non-banking financing companies(NBFCs) provide schemes on the gold loan, especially during the festive seasons. An applicant saves a lot of money while availing of a gold loan during a festive season. Many public banks also provide various schemes on the gold loan, which the applicant can avail.
  
  
  Conclusion :
  
  The loan value depends on the amount of gold ornaments given to the bank and the purity of the gold. The gold loan has many perks. One of its biggest perks is that it can be used for several purposes. Gold loan is one of the most advantageous loans in today's modern times as it has helped a lot of people during financial difficulties. Gold loan is also a very convenient option for down payments.

Read More:- Know About Gold Rate In India 

Gold is a precious metal like platinum silver, and it is shiny and brings shine and happiness to the lives of the people by providing financial help in the form of gold loan from the different types of loan providers like banks and nbfcs. The hallmark concept was first introduced during the fourth century only, which was first done during the time of precious metal silver. Then it is continued to be used in different precious metals like gold and platinum. So we can explain the full procedure and complete the certification of purity and fineness of gold, which is termed hallmarking. In our country, one of the most important challenges in the problem can be seen frequently that it has increased India’s condition for buying in kind of gold with low Gold Loan Interest Rate or availing a gold loan during the time of emergency.

Previously there was a nose search problem, but as the technology got to advance, the fraudulent activities have also got increased due to which the cases of false gold it has been noticed in different opportunities, and this is the reason that starting of the hallmarking system in India BIS after which customers are feeling much safer as it has been done for the safeguard of the interest of the gold customers who are purchasing the gold for availing it in the form of a loan. This is why not only for the purchasing of the gold but also for availing alone in the form of a good loan where the original school will be required to pledge in the bank. So the Financial institutions are also guiding the customers to use the goal of having hallmark as it will prevent them from cheating and fraudulent activities to be coming in the future can happen at any time.

Along with the hallmarking of the gold, some significant requirements need to be followed by the person who wants to avail of a gold loan and enjoy the financial boon. Many lenders or loan providers in the market do not exceed the gold below the purity of 18 carats. Canara Bank Gold Loan has some such facilities to provide betterment for the customers. The different types of stones on the diamonds attached with the gold jewelry will not be treated as a part of the gold during the valuation of the gold either as per the weight or as per the value. On the other side of the head and some limitations, rules, and regulations are also there for the gold coins in some cases and places. The coin’s purity might be asked to be more than the normal purity limits and weight. Sometimes, the weight is more than 350 grams, and most Financial institutions do not like to maintain it.


Before availing of any type of loan, especially in the case of the gold loan, there is always a necessity that is kept as the gold loan is preferable by almost all the sector of the society because previously there was a lack of information along with the connectivity. The flexibility in different kinds of payment methods will make the person feel so that if one payment is overlooked or forgot to research what type of payments like that of monthly instalments. The first and foremost, if we can see, is a picture of the process of paying the interest every month but repaying the principal at the last turn off period. One of the most significant advantages of paying in this type of loan that there will be less working during the initial time of the loan term. On the other hand, there is a concept of bullet repayments where there is a requirement to pay the whole interest and the principal amount at the end of the loan term.

Also Read:- Where Do We Find Gold Rates Involved? 

HOW DOES A GOLD LOAN WORK?

In a gold loan, the borrower applies for a gold loan by pledging his gold articles as collateral or security. The borrower gives these articles as a security, that, in case if the borrower will not be able to repay the loan,  the money lender or the bank, which has granted the money, has all the rights to sell that gold takes the amount of money.

A gold loan works in the following steps: -

1. You need to visit the bank with the gold articles that you want to pledge.
   
   
2. The moneylender will check the purity and the value of the gold.
   
   
3. After checking the value of the gold, the price of the gold is decided.
   
   
4. Then, after deciding the market price of the gold, the amount of loan will be decided that the bank will grant you. It can go upto a maximum of 80% of the value of the gold that is pledged.
   
   

 JEWELLERS CAN NOW REPAY PART OF GOLD LOAN IN PHYSICAL LOAN: -

The bank provides an option to the borrower to repay a part of the gold metal loan (GML) in physical gold.According to the instructions given by the Reserve Bank of India, the banks who are authorised to import the gold metal and the banks who are designated to participate in Gold Molestation Scheme 2015 can give the gold metal loan to the jewellery exporters or the domestic manufacturers of the gold jewellery. Earlier, the gold loan was allowed to be repaid in cash (Indian currency - rupees), equal to the value of the gold. But now the Reserve

 Bank of India has made some changes which are as follows: -

• The banks shall provide the option to repay a part of the gold metal loan in physical gold of one kg or more to the borrower.
  
  
• The gold metal loan should have been extended out of the local sources. The RBI said that the repayment of the gold loan has to be done using the India Good Delivery Standards (IGDS).
  
  
• The bank also added that the gold metal has to be delivered directly to the borrower.
  
  
• Another condition that was laid down by the Reserve Bank of India for the replacement of the loan was that the agreement of the loan should consist of the details of the options that can be used by the borrower. The details of the acceptable standards and the manner in which the gold has to be delivered for the repayment of the gold metal loan

ADVANTAGES OF A GOLD LOAN: -

The following are the advantages of a gold loan which are boon for the borrower to obtain Gold Loan: -

• Faster processing- A gold loan is a secured loan, and therefore, it includes minimal documentation and lenient eligibility criteria. A credit score is also not required for the approval of a gold loan. Therefore, the money lenders generally disburse the gold loan in a few hours. Axis Bank gold loan offers minimal documentation.
  
  
• Lower interest rate-  The interest rate on a gold loan is low compared to the other loans, such as a personal loan or a car loan. If you will attach another asset as security, then the interest rate can be lowered further. The interest rate can be calculated with a gold loan calculator.
  
  
• No processing fee-  Most of the banks do not charge a processing fee for the gold loan. If some of the banks or the money lenders charge a processing fee, it will be only 1-2% of the loan amount.
  
  
• No foreclosure charges- There are no foreclosure charges on a gold loan. However, if a bank or a money lender asks for some, it will be only 1-2% of the loan amount.
  
  

No income proof needed- There is no need for any income proof when you are applying for a gold loan because you are 

Must Read:- Gold Loan Repayment Methods 

WHAT IS A GOLD LOAN?

A gold loan is a loan that one can avail of from a bank. It is a secured loan which means that when a person wants to take a gold loan, he needs to pledge his gold articles as collateral or security. The gold will be kept safely by the bank or by the moneylender, and after the successful completion of the loan and the repayment of the EMIs, the gold that the borrower pledged is given back to him. In this loan, the loan amount depends on the market value and the purity of the gold rather than the source of income. If a person is not earning at the time of availing of a loan, the bank can also accept his application.

WHAT IS AN INTEREST RATE?

When a borrower takes a loan from the bank, he has to repay the loan to the bank or the moneylender with interest after the disbursal of the amount of money. This is how the banks make money. So, when a person takes a gold loan from a bank, he will need to repay the loan with the gold loan interest rate. The interest rate varies from bank to bank and from one moneylender to another. Some of the banks offer lower interest rates on the gold loans that they provide. 

BANKS THAT CHARGE THE LOWEST INTEREST RATES ON THE GOLD LOANS STARTING FROM 7%: - 

The gold deposited by the borrowers support the gold loans, and therefore, they do not require high-interest rates. The time taken to disburse the loan is very little as compared to the other loans.

The following are the top five banks that charge the lowest rate of interest on the gold loan: -

• Punjab and Sind Bank: - The rate of interest offered on the gold loan is 7%.
  
  
• Bank of India: - The rate of interest offered on the gold loan by the Bank of India is 7.35%.
  
  
• State Bank of India: - The interest rate on a gold loan offered by the State Bank of India is 7.5%.
  
  
• Canara Bank: - The rate of interest offered by the Canara Bank on a gold loan is 7.65%.
  
  
• Union Bank: - The interest rate on a gold loan offered by the Union Bank is 8.2%.

FEATURES OF A GOLD LOAN: -  A gold loan is one of the cheapest and the most hassle-free loans. A person can get immediate cash. The money lenders or the banks do not require high credit scores. The time taken to disburse a gold loan is also less as compared to the other loans. 

Following are some of the features of a gold loan: -

• Tenure: - The banks issue the gold loans for tenures of upto twoIn addition, the years. You can renew the loan after that tenure.
  
  
• Collateral: - In a gold loan, you have to keep your gold as collateral or security to the bank. The banks can offer upto 80% of the value of the gold as the amount of loan. The higher the loan to ratio value, the higher will be the rate of interest.
  
  
• Repayment: -  A person gets flexible repayment options to repay a gold loan. He can either go for a regular EMI option or the bullet repayment method. In the case of a gold loan, partial payment is also available for gold loan at HDFC  offers flexible options.
  
  
• Credit score: -  You do not have to worry if you do not have a credit score or a good credit history. Your loan application will be accepted if you have a low credit score.
  
  

Documentation: -  The documentation process involved in a gold loan is really easy and minimal. There are not many documents required, just the basic ones such as identity proof, address proof, etc. In some of the banks, income proof is also not needed to apply for a gold loan.

Must Read:- Best features for Gold Loan 

In today’s world, no one knows when the need for quick funds arises and for that, a gold loan is the best solution as a gold loan can get you the fastest funds to meet your requirements. But there are certain things or key points that one should keep in mind before availing of a gold loan as with the growth in the market, the risk has also increased, so it is important that one should be cautious and keep important points in mind before taking a gold loan. But now, people have come to realise that gold kept idle in bank accounts can be rather used to get quick funds whenever needed. As gold loans have emerged as one of the most popular ways to secure quick finance. In addition, gold loans can be used for any purpose unlike other types of loans that have a specific purpose.

So, Let Us Discuss Some Of These Important Points:-

• Loan Amount:- As a gold loan is a secured loan, the amount of a gold loan will depend on the gold that you pledge as collateral. RBI has chosen the loan-to-value ratio as 75% of the total value of gold that is pledged. The amount of loan that you will get will also depend on the lender you choose to get it from.
  
  
• Interest Rate:- The interest rates of gold loan varies according to the lenders and depend on a lot of factors such as loan amount, LTV ratio, loan tenure and many other factors. For example, if the LTV ratio is high, the lender will tend to charge a higher rate of interest to compensate for their risk. Therefore, one should compare the gold loan interest rate from secured as well as an unsecured loan to check the most suitable among them.
  
  
• Processing Charges:- Usually gold loans have zero or minimal processing charges that are as low as 1%-2%, it depends on the bank or lender how much fees they will charge, some might charge a fixed percentage whereas others might charge some percentage of the whole amount of the loan.
  
  
• Loan Tenure And Repayment Tenure:- The gold loan is a short term loan with a flexible tenure that can range between 7 days to 3 years. This can vary from different lenders and banks. Banks and lenders also offer a variety of repayment options along with the usual monthly instalments mode. Borrowers can choose to repay the principal amount at the end along with all the monthly instalments or they can pay monthly instalments every month and the principal amount at the end of the tenure. A person can even calculate his monthly instalments prior to applying for a loan by using the EMI calculator to know if he will be able to repay the instalments or not. One can choose the one according to their convenience. For example, the EMI system will suit a salaried person with regular monthly income and the non-EMI system will suit self-employed workers who do not have a fixed source of income per month.
  
  

Now, these are some of the important points that one should keep in mind before taking a loan as one should make sure that every condition is well-suited for him before stepping into taking a gold loan. Now,if we talk about the lenders or banks, one should make sure that they avail gold loan from a trusted source as you should have trust in the bank or lender you pledge your gold with. So, here is a solution to this, Muthoot Finance gold loan. They are well-known for their years of service in the field of lending loans and are trustworthy with your pledged gold. They offer you attractive deals under gold loans from which one can choose what he finds to be the most suitable. They have easy terms and conditions with minimum document requirements. So, one can avail a gold loan from them.

Gold has become an important asset over time. One can easily use gold as a security against loan to avail gold loan. The documents required for applying for a Gold loan are Aadhar Card, Valid Driving License, Valid Passport, Voter’s ID Card, Salary slip, income tax return documents, employment proof, bank statements, income proof and other documents as asked by the lender. While applying for a loan fill out the application form carefully. Try to avoid errors for fast approval of the loan.

IIFL gold loan can be applied online as well as offline. One can also get various schemes on gold. IIFL gold loan charges reasonable interest rate and processing fees on gold loan. The internet rate starts from 9.24%. You can also choose any payment option as per the convenience as the IIFL loan offers various payment options. For more information regarding gold loan can visit the official website of IIFL gold loan. Getting a loan is a big deal. The applicant should be careful while applying for a loan and also they should try not to share any sensitive information online to avoid loans. One should always take a loan from a verified lender to avoid any kind of loss. 

Follow below listed tips to save yourself from fraud lenders :

Check online :- 

Before applying for a loan check online all the information regarding the chosen financing companies. It is always recommended to take a loan from a verified bank or non-banking financing companies(NBFCs). Guard all the information of the chosen financing companies online before filling out the application form. 

Monitor your account :- 

Another very much crucial step is to monitor your account daily. Try to install a mobile banking app and check your account balance, account activity and transactions. While applying for a loan always keep a close track on all your account activities. Report your account if you find anything suspicious. 

Check your credit report :-

Always try and check your credit report timely. Review your credit report properly. Beware of anything suspicious on your credit report. 

Filter your phone calls :- 

Always try to filter your phone calls. Try to avoid phone calls and messages from a fake number. Do not answer any non-essential message. Keep a closer look on phone calls and messages and try to avoid anything suspicious. 

Don't share your bank information :- 

One should not try to share any kind of bank information to avoid loss. Do not share your bank details to anyone from your phone or social media. Bank details should be kept like a secret without sharing with anyone. People can avoid any loss by not sharing the personal bank information to a non verified lender. Always be cautious and careful of the activities you perform online. 

Secure your internet connection :- 

This is another important point before applying for financing help. Try to secure your internet connection to avoid any kind of loss. Protect your Wi-Fi by setting strong passwords. Also be cautious about the information you are sharing online. Protect yourself from fraud lenders by not sharing any sensitive information online. 

Report anything suspicious :- 

An applicant should carefully and quickly report suspicious activities. If you find anything suspicious happening in your account report quickly to avoid further loss. And also if you find the behavior of the lender suspicious, report him quickly.

Conclusion :-

These Days many fraud cases related to lenders are being registered. One should be careful while availing loan. People should also be aware of the lenders and research about them carefully online. One should try not to share any information or bank related details to any lender without verification to avoid loss. Monitor your bank account on a regular basis. Avoid any spam messages or calls received. Protect yourself from fraud lenders by protecting your internet with strong passwords.

Also Read:- Debt Finance Or Equity Finance - Which One Is Advantageous? 

Gold loans are popular in India. People in rural as well as urban areas rely on gold loans in the financial crisis. It has become one of the most trustable loans over the years. It requires easy application and can be applied from almost every bank and non-banking financing companies(NBFCs). Gold loan calculator is the online tool used for calculating the loan amount availed accurately. 

Future Capital gold loan can be availed through an online website or the nearest branch. It offers an affordable interest rate on the gold loan. It provides flexible loan tenure to the applicant. The application process is quite easy. The required documents are Aadhar Card, Valid Driving License, Valid Passport, Voter’s ID Card, Salary slip, income tax return documents, employment proof, bank statements, income proof and other documents. Future capital is recommended to get the gold loan and avail various discounts. 

The loan disbursal process of gold loan is quite fast and convenient for the applicants. The amount is sanctioned in the account of the borrower after the documents verification is completed. The amount is sanctioned between 24 to 72 hours. Once the purity check of the gold is done and the documents are verified the loan amount is sanctioned in the applicant's saving account. The fast loan disbursal of gold loans is very much beneficial for the borrower. 

Few important things to consider before applying for a gold loan is listed below:- 

1) Compare Interest Rates:- The interest rate offered by various banks and financing companies may differ. Try to choose a lender who offers minimal interest rate on the gold loan. Before filling out an application form always remember to compare different options to get the best possible deal on the gold loan. 

2) Credibility of the lender:- This is yet another important point to consider before applying for a gold loan. Always check for the credibility of the lender online for avoiding any kind of loss. Try to choose a reputed lender. Choose a lender as a private bank or public bank or non-banking financing companies(NBFCs). 

3) Choose tenure:- One more important point is to select a proper tenure for a gold loan. The shorter the loan tenure less will be the interest rate charged. Choosing a proper tenure is important to avoid any kind of loss. Many banks and non-banking financing companies(NBFCs) offer various tenure options to the borrower. One should compare the various tenure options offered by different lenders to avoid loss and get the beat deal. Moreover, one should choose the loan tenure according to the financial conditions. 

4) Repayment Method:- There are various repayment methods available at the banks and non-banking financing companies(NBFCs). One can choose the preferred repayment option as per the convenience. Remember to choose the right repayment option as per the financial convenience. 

5) Check the market price of the gold:- Before applying for a gold loan always remember to check its market price. The higher the market price the higher will be the loan amount availed. One should always apply for a gold loan keeping in mind the market price of the gold to avoid any loss and get the best possible deal. 

All over India people opt for gold loans in times of the financial crisis. It is a multi purpose loan and can be used for various purposes as per the need of the borrower. One can use the loan amount availed for educational, business, travel, house repair, buying a car, marriage and many other personal purposes. One needs to plan the entire process before applying for a gold loan to avoid any kind of a loss. One also needs to evaluate the gold purity before applying for a gold loan. All the necessary information regarding gold loan and its fast loan disbursal is given above.

Must Read:- What is the Tenure Period of a Gold Loan? 

One of the major reasons people find it convenient to go for gold loans is its affordable rates of interest. So, now we are going to talk about various aspects that are involved in the availing of gold loans. So, let me tell you that there is not much difference between gold loans offline and gold loans online. It is just that under gold loan online, one has to do the same procedure that they would do by visiting a bank branch under the offline gold loan. You can avail of a loan against the gold that you once bought or made an investment in and use it for your urgent need for funds. Gold loans have many benefits because they have gained a lot of prestige in the market and have become popular amongst people.

So, let us discuss the process of getting a gold loan, so the steps are as below:

1) Gold loan application:

The first step in this process is to opt for a loan amount that you would want from the lender, various institutions offer gold loans, and before going to one of these, you should make sure that you have compared different banks and lenders and choose the most suitable one for this process. There are two methods for the application process, that is, online and offline. For the online process, you need to go to the website of the bank or lender and apply for the loan there, whereas, in the offline method, you need to go to the nearest branch and fill the application form there.

2) Gold submission:

This is the most important step to get a gold loan; your bank or lender’s website needs to submit the gold ornaments as security or collateral. You must not forget that the submission of gold cannot be made online, so you need to visit the branch and submit your gold.

3) Gold evaluation:

The third step is gold evaluation. Under this process, the lender or bank will calculate the total value of the gold you have pledged. This is determined by the current market value of the gold, and the value of the gold will tell how much loan you will get for the gold pledged. So, it will majorly depend on the value of your gold. One can get a maximum of 90% of the gold value as the loan amount. And the lenders give the amount according to the Gold Loan Per Gram.

4) Documentation process: 

In this process, you will have to submit a few documents to the lender. This involves simple documentation with minimum document requirements such as identity proof, residency proof, income status, passport size photographs, etc.

5) Eligibility, Authentication, and disbursal:

After all the steps are done, the lender checks your eligibility. Each bank and lender has a different set of conditions based on which they check eligibility. These banks' or lender’s website factors generally involve the borrower’s age, purity of the gold pledged, etc. A person with a low credit score can also get a gold loan. After all this, the authentication is done, after which the amount of the loan is disbursed into your bank account. This is the whole process of applying for a gold loan and what is required to get a gold loan approved.

If we talk about a gold loan, everyone must have heard of the name of Gold Loan in HDFC Bank as they are quite popular among this line of lending against pledged gold. HDFC can be a really good option for you to get a gold loan as they offer a lot of different schemes to choose from. So one can compare these different schemes on various bases before applying for a gold loan under one of these schemes.

Also Read:- Gold Loan Plays An Important Role In Medical Emergencies Too 

Gold loans are secured loans that are issued against collateral and come with quite a low rate of interest that is very attractive. There are many benefits of gold loans such as:

• Eligibility criteria: In case of gold loans, eligibility criteria is important in quite a few areas such as age which should be between 18 years to 75 years, then the profession of the applicant is also very important criteria for the gold loan, credit score is not that important when it comes to applying for a loan due to it being a secured loan.
  
  
• Rate of interest: Rate of interest is the factor that makes borrowers choose gold loans over other types of loans because gold loans require a low rate of interest. The rate of interest under gold loans range between 9.24%-26% and can vary according to different banks that apply for the gold loans. Usually the amount of the loan is given on the basis of the gold rate today. And banks and lenders only offer up to 90% of the total value of gold during that point of time, in the market.
  
  
• Processing fees: This is the charge paid by the borrower to the lender for the time between the submission of the loan application and the bank’s approval of the application, this is the fees that lenders charge for checking the application and documents with it. Now, these fees depend on different banks and can vary from bank to bank. Some might charge a processing fee as low as 1%-2% while others might charge it in the form of a particular percentage on the whole amount of the gold loan.
  
  
• Repayment tenure: Every loan has a tenure which is kind of an expiry date and within that tenure the borrower is liable to repay the principal amount along with the monthly installments. Now, since gold loans are short term loans they can be repaid within a time period of one year. And one can check their monthly installments through the EMI calculator which is provided on the website of every bank so that they can calculate their suitability of being able to pay back the principal amount along with the monthly installments within the stipulated time.
  
  

Now, these are some of the benefits that gold loan offers over any other type of loan and gold loans can be used for any purpose unlike home loans etc. which must be used for the work they are available for. These are some of the reasons why borrowers' first choice is a gold loan and not any other type of loan.

Now, there are many banks and lenders in the markets that offer you a gold loan but not every bank and lender is trustworthy with your gold pledged with them. So, one should make sure that they should take a gold loan from a trusted bank only. And Yes Bank Gold Loan is the solution to this as they offer loan with minimum documents some of which are Identity proof, that includes, PAN card, driving licence, voter ID, Valid passport etc., Address proof, that includes, electricity bills, water bills, telephone bills, Aadhar card, PAN card, driving licence, voter ID, Valid passport etc., Other necessary documents such as passport size photographs, proof of 5 years of business continuity (for self employed individuals) etc. One should always make sure to carry the original copy of the documents along with photocopied documents so that the process can be done without any delay or mistakes. They also provide flexible tenure and low rates of interest with attractive offers. In addition, your gold is safe as they are a trusted bank which has provided services of loans for years.

Read More:- Best Way To Choose When Avail Gold loan 

There are plenty of options to pick from while these loans can meet certain financial needs, an online gold loan outperforms them all in ease, quickness, and utility. Apart from the fact that they may be applied for it any time and from any location, the gold loans feature require fewer documentation requirements, a lower interest rate, and are approved faster than conventional loans. The Gold Loan process is very similar to that of other secured loans. In this case, you take your gold items to a lender along with the necessary paperwork. The lender assesses the gold items and confirms the paperwork presented. The lender approves the loan amount based on the evaluations. According to the loan agreement, you must repay the principal and the interest at the end of the loan period.

The Benefits Of A Gold Loan

Because gold loans are based purely on actual assets, you can use them for various objectives in financing. Here are some of the most common purposes for a gold loan:-

• In Order To Pay For Your Education:- Many colleges provide student loans to cover tuition, hostel fees, books, and other relevant expenses for college admission. However, education or student loans are subject to a number of conditions. Here a gold loan can pay a significant loan because it provides immediate cash to the person in need. Applying for a gold loan can be a reasonable solution if the institution is not suitable or if the applicant's income is insufficient to qualify for a student loan.
  
  
• Automobile Finance:- A gold loan can also be used to finance the purchase of a vehicle. Unlike a car loan, gold loans do not need the seller to provide any documentation, nor do they require evidence of income. You may get a gold loan online with great ease to buy a new or used car, scooter, or heavy vehicle for personal or commercial use.
  
  
• Use Of Existing Assets:- Borrowers who take out a gold loan might put their jewellery, gold bars, or coins up as collateral. This means that the consumer has the option of owning the jewellery and borrowing against it at any time. When the loan is paid off, the jewellery is securely returned to the customer, or it can be reused.
  
  
• Whether It's A Business, Startup Or A Small Shop:- For individuals in need of quick financial planning, gold loans are suitable. You may have an excellent idea for a business, but a lack of necessary funds is required to get it off the ground. This is frequently the case with female entrepreneurs who have the expertise but not the funds to start a business at home. On the other hand, a gold loan can assist finance any form of business, big or little. Bank has introduced a new gold loan scheme with a lower interest rate of 7.35% for various industries. The loan can be used for multiple purposes. The interest rate on a Bank of Baroda Gold Loan starts at 7.35%, with a processing fee of 0.5% of the loan amount.
  
  
• Multiple Usages :- A gold loan can also be used in renovating the house , a person can take out a loan with the help of a loan and can invest in many ways . Renovating a house is not in the hands of middle class people, but with the gold loan, it is possible now people can dream big .
  
  
• Quick Approval And Payment:- During a business's financial emergency, owners rarely have the time to go through a long loan application and approval process. Despite this, most banks and NBFCs impose a number of formalities that lengthen the process. A loan manager from the company calls you to fill an online application to assess the worth and purity of the pledged jewellery. Applicants obtain immediate approval after the gold is valued and the KYC documents are submitted. Furthermore, after approval, the loan amount is sent to the borrower's account within 30 minutes.

FEATURES OF A GOLD LOAN: -  

The features of a gold loan can be summed up in the 

following points: -

• PURPOSE- You can avail a gold loan to fulfill your financial needs like for medical emergencies, educational purposes, for a vacation, for a wedding, etc.
  
  
• SECURITY- The gold that has been pledged by you with the financial institution or the bank or the money lender acts as a collateral or security against which the amount of loan is provided.
  
  
• TENURE OPTIONS- The tenure for the repayment of a loan can range between 3 months to 36 months.
  
  
• FEES- The charges and the other fees that are applicable on a gold loan are - late payment charges, processing fee, valuation fees, non-payment of interest, etc.
  
  
• REPAYMENT OPTIONS- There are different repayment options available that are offered by the money lenders to the borrowers.
  
  These are as follows: -

1. Repayment of loan in Equated Monthly Installments (EMI).
   
   
2. Payment of interest upfront and then, the repayment of the amount of loan at the end of the tenure of repayment.
   
   
3. Payment of interest every month and then, the repayment of the amount of loan at the end of the tenure of repayment.
   
   

• REBATES- Most of the lenders offer discounts on the existing interest rates on the gold loan, if the borrower repays the existing EMIs on time. This rebate can go upto 2% on the original interest rate.
  
  
• SAFETY- The gold that you will deposit to the bank or to the money lender as a collateral or security to the bank is absolutely safe. You do not need to worry about the gold that you have deposited. Your gold will be kept in a safe place. And after the successful repayment of the loan, the gold that was deposited by you as a security will be given back to you.

DOCUMENTATION: - The documents that a borrower needs to have while applying for a gold loan are as under: -

• Two passport size photographs.
  
  
• ID Proof- Driving License, PAN card, Passport copy, Aadhaar Card, Ration card, Form 60, etc.
  
  
• Address Proof- Driving License, Voter ID, electricity bill, Ration Card, Passport copy, registered lease agreement not older than three months.

BENEFITS OF A GOLD LOAN: - 

• MINIMAL DOCUMENTATION-  Most of the banks offer a simple documentation process as it is easy both for the borrower and for the lender too. The borrower needs to submit only the necessary documents and there is no need for any income proof. SBI gold loan ensures minimal documentation.
  
  
• WAIVER ON FORECLOSURE CHARGES-  Most of the banks does not levy any foreclosure charges on the loan after a minimum time period. So if a borrower wants to foreclose a loan, he can pay off the entire amount without paying the foreclosure charges.
  
  
• LOW INTEREST RATES- The interest rates on a gold loan are lower as compared to the other loans. This is because the borrower provides a security to the bank so, the rate of interest is low in a secured loan.
  
  
• FLEXIBLE REPAYMENT TENURE- The minimum tenure for the repayment of a gold loan is six months and the maximum tenure for the repayment of a gold loan is 24 months. However, a borrower can choose the tenure according to his needs. You can also get a high maximum LTV (Loan to Value) ratio of 75% of the weight of the gold that was calculated.

CONCLUSION: - When a person is in need of instant funds, the most safest option is to avail a gold loan. He can make use of the gold that has been lying in his cupboard for ages with no use. He can use it to cope up with the situation and after attaining the loan, he has to repay the amount back with interest. After the successful completion, he can get his gold back too.  The gold loan interest rate is also really low as compared to the interest rates on the other loans. Therefore, it is an affordable option to apply for a gold loan. The main important thing in this loan is the purity of the gold.