Since the beginning, Indians have a strong affinity towards gold. Also, as per historical data, gold has proved to be the best hedge against Inflation. India imports 25%-30% of gold production. Many banks and institutions offer gold loans with effective interest rates. In this article, you'll understand the important aspects of gold loan, top banks Offering gold loans, eligibility and procedure to apply for gold loan.
Here is the list of top banks and financial institutions offering gold loans in India.
Below is the tabular form that gives details about a gold loan with the loan amount, interest rate and tenure.
|Lenders||Interest Rate||Loan Amount||Tenure|
|Mannapuram Gold Loan||Up to 28%p.a||Rs. 1,000 to Rs. 1.5 cr||3 months onwards|
|SBI Gold Loan||7.30% p.a onwards||Rs. 20,000 to Rs. 50 lakh||Up to 3 years|
|HDFC Gold Loan||12.04% p.a onwards||Starting Rs. 25,000 onwards (Rs. 10,000 for rural areas)||6 months to 4 years|
|Axis Gold Loan||13.50% p.a.to 14.50% p.a.||Rs. 25,001 to Rs. 20 lakh||6 months to 3 years|
|ICICI Gold Loan||11% p.a onwards||Rs. 10,000 to Rs. 10 lakh||Up to 6 months to 1 year|
|Canara Gold Loan||11.95% p.a onwards||Rs. 10,000 to Rs. 35 lakh||Up to 1 year|
|Bank of Baroda Gold Loan||11.65% p.a onwards||Up to Rs. 25 lakh||Up to 1 year|
|Karnataka Bank Gold Loan||10.65%p.a onwards||Up to 5 lakh per account||Up to 1 year|
|PNB Gold Loan||10.05% to 11.05% p.a||Productive purpose: No limit, Non-productive purpose: Up to Rs. 10 lakh||As per the lender’s terms and conditions|
|India Infoline||6.48% - 27% p.a||Rs. 3000 onwards||3 to 11 months|
|Kotak Mahindra Gold Loan||8% to 17% p.a.||Rs. 25000 to Rs. 1,50,00,000||3 months to 3 years|
|Federal Bank||6.99% p.a onwards||Up to Rs. 40 Lacs||As per the lender’s terms and conditions|
|Central Bank of India||10.65% p.a onwards (Floating Interest Rate)||Up to 50 grams of gold can be committed as a security||Up to 12 Months|
|Union Bank||9.90%||Rs. 20 lakh priority sector, Rs. 10 lakh non-priority sector||Customised|
|Muthoot Finance Gold Loan||12% to 27%||Rs. 1500 to no maximum limit||7 day to 3 years|
|Kerala Gold Loan||8.90% to 12.10%||Maximum loan amount up to 80% of appraised value of gold can be availed.||Customised|
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An individual can avail a gold loan for various needs such as educational purpose, vacation, medical emergencies, and so on.
Gold itself acts as Collateral against the loan.
Ideally, the loan tenure falls between 3 months to 3 years. But again, it may vary bank to bank.
Processing fees, late payment charges/fine for non-payment of the interest are some of the terms applicable for gold loan. So ensure you know all the terms of the loan before applying.
There are mainly three options where the lender can offer the customer for repaying the gold loan. They are-
Sometimes the option of discount is offered by the lenders at the prevailing interest rate on the gold loan. This is if the customer repays the interest on time, then 1% -2% discount might be offered from the original rate of interest.
Individuals can apply for the gold loan through an online /offline mode. For the online process, one has to visit the lender’s website and apply, thereby filling the form with mandatory documents.
You can also visit the nearest institution or branch of the lender. Fill the application form and submit to the lender. They will verify the form, depending on which your loan will be approved.
The eligibility criteria for gold loan differs from bank to bank. The following are some of the general terms of the gold loans-
While applying for the loan, you will be given a form which you need to fill with proper details. Following, you need to submit certain documents mentioned below-
Gold Mutual Funds is a variant of Gold ETFs. A gold ETF (Exchange Traded Fund) is an instrument that is based on gold price or invests in gold bullion. A gold ETF specialises in Investing in a Range of gold securities. Gold Mutual Funds do not directly invest in physical gold but take the same position indirectly by Investing in Gold ETFs.
Also, the minimum investment amount one would require to do in Gold Mutual Funds is of INR 1,000 (as monthly SIP). Since this investment is made through a Mutual Fund, investors can opt for systematic investments or withdrawals too. As Gold Mutual Funds units can be bought or sold from the fund house, investors do not face liquidity risks.
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 5 YR (%) 2021 (%) Axis Gold Fund Growth ₹16.2579
₹260 5.3 4 11.6 11.1 12.2 -4.7 HDFC Gold Fund Growth ₹16.6813
₹1,290 5.7 4 11.4 11 11.6 -5.5 SBI Gold Fund Growth ₹16.2982
₹1,138 6.3 4.2 11.9 11 11.6 -5.7 Nippon India Gold Savings Fund Growth ₹21.3791
₹1,379 5.7 4.1 11.5 10.8 11.3 -5.5 Kotak Gold Fund Growth ₹21.4937
₹1,275 5.2 3.4 10.4 10.8 11.8 -4.7 Invesco India Gold Fund Growth ₹15.7696
₹57 5.2 3.9 11.4 10.7 11.5 -5.5 ICICI Prudential Regular Gold Savings Fund Growth ₹17.2019
₹625 5.2 4 11.1 10.7 11.3 -5.4 IDBI Gold Fund Growth ₹14.4514
₹40 5.9 3.8 11.8 10.7 11 -4 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 2 Dec 22
Gold Funds having AUM/Net Assets >
25 Crore ordered based on 3 year CAGR returns.