Blog #Manappuram Gold Loan Rate

If a person has an emergency medical bill to settle and needs Rs 5 lakhs, and if he faces a shortage of Rs 3 lakhs, then taking a gold loan can be a good alternative. If the person already has a good bond with the Bank, then the bank relationship manager can help by giving an unusual gold loan scheme that can save a good amount of money. The bank can offer the remaining amount to the person if he surrenders the locker he has with that Bank and thereby apply for a gold loan. The surrender of the locker can save annual locker charges of at least Rs 8000 and can supply him the amount that he requires to meet his expenses. The person used the locker to keep the gold safe; now, he can get a gold loan instead of it.


After the covid-19 pandemic struck, gold loans have become vastly popular among the masses even after the prices of gold touched Rs 50,000 per 10 grams. Observing the appetite for Gold loans in the Indian loan market, the Reserve Bank of India also permitted the Banks to deliver gold loans to their customers at an enhanced loan to value ratio. The RBI allowed the loan to value ratio against gold loans at 90% of the value of gold pledged until 31st of March 2021; it again came back to the conventional 75%. Enhanced loan to value ratio means getting an additional amount of loan against the exact amount of gold.


A bank locker is considered a safe storage place for multiple items, mostly assets like gold ornaments, diamond jewellery, articles or jewellery made of silver or legal documents like a will or insurance policy. Gold loan against Bank lockers can also be forfeited if the person fails to repay the loan. The banks can have the malafide intention of taking away the accumulated Gold jewellery of a middle-class borrower. A person holding a bank locker needs to expend a nominal amount as annual rent. In contrast, in a gold loan, the liability of paying the loan back cost heavily upon the borrower.


Sometimes the lending institution can offer gold loan overdraft schemes at nominal processing fees and even facilities like pay only interest when a customer utilises the overdraft facility. The interest rates on gold loans can start from 7.4 per cent, and the monthly instalment that a person needs to give against a gold loan every month can be evaluated in a gold loan calculator. If a person does not use a credit facility, they benefit from paying less to the bank against the locker charges if he had used it to store his assets, especially gold.


Banks generally push the customers to have a gold loan scheme in the bank overdraft facilities where a person needs to keep their ornaments secured with the bank to take a gold loan overdraft facility. This further provides insurance on the pledged gold and saves the cost of renting an individual locker. But many customers fall into a debt trap when they give up their locker facility and take credit lines from the lending institution. On the other hand, Manappuram gold loan rate or gold loan from any other bank has numerous benefits and flexible repayment options that can be profitable compared to a gold loan against a Bank locker. If the borrower defaults in paying back the loan amount, it will not only auction off the pledged gold jewellery but also hurt the borrower’s credit history. The banks will make good of their loss if a loan turns into non-performing assets through this auction. The experts always recommend getting a gold loan only if there is a financial emergency, as the jewellery pledged does not have any utility value.

Also Read:- Why is the Gold loan profitable? 

Authorized lenders like Banks and Non-Banking Financial Companies(NBFCs) provide financial services to customers in need and want day after day all over the world and all year round. Lending loans are a primary part of their job. The Reserve Bank OF India approves these loans before ṭhey are available in the finance market. Loans are broadly categorized as secured and unsecured. For example, a gold loan is secured and needs an asset as collateral. A gold loan is advised to be availed from these lenders over unauthorized ones. But among these two, they vary in certain aspects which are to be considered solemnly before taking out a loan from them.

Banks :- Banks are financial providers registered under the Banking Regulations Act of 1949. They are government-authorized, providing many commercial services like depositing money, cash withdrawal, amount transactions, settlements, account holdings, locker services, and lending loans.

There are different types of banks, namely private banks, public banks, cooperative banks, and development banks. Private banks are owned by private individuals or societies or cooperations and highly commercial. SBI, HDFC Bank, Axis Bank, and Yes Bank are some of the private banks. Public banks are owned by central or state governments and are more service-minded than private banks by nature. Indian Bank, Indian Overseas Bank, Bank of Baroda are some of the public banks. Development banks are designed for short-term and long-term investment projects and are primarily in the development sectors of the finances. IDBI, IRCI are some of the development banks. Co-operative banks are majorly designed for rural India, and it concentrates on providing financial services to the agricultural and day laborers of the nation. 

The loan offers are more favorable in cooperative banks than others.TJSB and Bharat co-operative banks are a few of them :-

Non-Banking Financial Companies (NBFCs) :- Like banks, they are also financial providers legally licensed and registered under the Companies Act of 1956. The differences between a bank and an NBFC are that NBFCs can’t draw or issue demand drafts and are not involved in the transaction and settlement processes. Asset companies, infrastructure companies, and microfinance institutions are three primary divisions of NBFCs. UTI AMC, Muthoot Finance, Manappuram Finance are some of the famous NBFCs.

Comparison between banks and financial companies on Gold loan features :-

Financial companies are much more liberal and lenient on their rules and terms as opposed to banks. Though the documentation requirement is minimum in a gold loan, in general, NBFCs provide gold loans much more simply than banks that follow customs to the end. But, NBFCs tend to compensate for that lenience by charging high interest rates and additional charges( processing fee, commitment charges, TOD charges, etc). The loan amount sanctioned for a gold loan depends on the value of the gold and the rate of the gold on that day. 

The Gold loan rate per gram starts at Rs 3,506. The maximum Loan To Value Ratio of a gold loan as per the RBI is 90%. However, banks and NBFCs can adopt the LTV ratio to their convenience. Most banks have a high LTV ratio(like 90% or 80%) than most NBFCs(75% or 80%). The processing fee is incurred for the processing and approval of the gold loan application. The fee varies from one financial lender to another. But banks and NBFCs charge the same amount more or less. The prepayment charge is procured if the borrower closes the loan account before the decided tenure date, and a gold loan preclosure fee is widely NIL in most banks and financial companies. Although, recently, the RBI banned NBFCs from collecting preclosure charges on floating term loans.

Manappuram gold loan is one of the highly reputed gold loans with exemplary features. The Manappuram gold loan rate per gram varies from Rs 3,506 and Rs 4,621. The LTV ratio is 75% in the NBFC, with an interest rate beginning at 7% per annum. The loan can be applied online or offline.

Also Read:- Four Gold Loan Eligibilities That Serve As An Advantage 

One of the most challenging jobs in this world is to select among two identical things. And even toughest is when it is regarding something monetary related. In the case of the personal loan and the gold loan, something happens. Still, some differences need to be noticed. Therefore, there will not be an appropriate decision to select the correct option for suitability and meet the requirements that will be needed. So let’s go forward to implement the main difference between gold and personal loan and how they will be used in a better way in our life.

Recently, the finance ministry of India had announced the providing of relief to the customers that there will be an extension of the moratorium period, which were available last year during the pandemic when it just started. The relaxation and the reduction of the limitations and the rate of interest, and the other facilities have made it possible for the customers to keep their loan EMI with the structured format.

For example Manappuram Gold loan rate is having the best facilities for helping the customers. Firstly, an excellent clearance will be there regarding why the gold loan is preferred over a personal loan if it is adequately understood. A gold loan is a type of loan where the loan amount is availed based on the amount of the gold, which The Financial institutions value according to the loan to value ratio. Accordingly, the sanction of the loan amount gets disbursed to the applicant. While on the other hand, if we are talking about the personal loan, it is dependent on the performance of a particular person in his previous loan repayments. If a person has successfully been going through each can he steps and has completed till the last payment instalment. Then it is said to be a good credit score in such cases, and there will be the possibility of getting a loan to a higher extent.

In the case of a gold loan, the rate of interest is very low compared to all the types of loans available in the competition. The reason for such a purpose is that because there is the availability of the security of the gold, which is itself an act asset. It had a value against the fluctuating market like that of inflation or deflation on the basis of gold loan rate per gram. So gold gets the resale value even at that particular time. That is why the gold loan providers find it very much more manageable and the safest way to treat or accept the gold as collateral security or an asset.

In the case of the personal loan, there is a very much higher rate of interest charged because there is a risk factor that plays a vital role due to the non-availability of any kind of collateral security as it is an unsecured loan that is why the loan providers keep the eligibility criteria to a tougher extent in order to make sure that they should not get into any losses in the future. This is because of the personal loan, the only source of income is treated as the source of the repayment option through which the loan amount will be paid, and that is the only thing that is focused upon by the loan provider in case the personal loan for low credit score is also examined.

The documentation process in gold is quite precise and straightforward because only one document is required and nothing more than that. But one should make sure that people always keep a copy of proof of identity, proof of address ownership documents, and passport size photographs nowadays. Moreover, in the case of a personal loan, there are not only these kinds of documents mentioned in the above lines only require, document sets like that of the income proof salary slip business ownership documents of shares if no other security is available.

Conclusion:-

We can see that a gold loan is always far better than a personal loan when it is coming based on trust. Then indeed, the whole loan will always help as a true friend whenever there is an emergency fund requirement.

Also read:- What Is The Easiest Way To Get Personal loan