Synopsis
Gold loan interest rates:
For gold loans, lenders keep your gold as collateral for the duration of the loan. Lenders impose an interest and after you settle the full loan, they return your gold jewelry.
Interest on gold loans Gold loans are suitable for those who need fast access to funds without selling their assets. Gold loans are secured loans where gold jewelry or coins are pledged as collateral. These loans enable speedy disbursal and are often utilized for short-term financial requirements.For gold loans, lenders keep your gold as collateral for the duration of the loan. Lenders impose an interest and after you settle the full loan, they return your gold jewelry.
Know what kinds of gold are eligible for gold loans?
A gold loan is not available for all types of gold. The website of HDFC Bank states that “the majority of banks only accept gold jewelry.” Also, the purity of gold provided as collateral should be between 18K and 22K.” You can get an SBI Gold Loan by pledging gold jewelry, such as bank-sold gold coins.
HDFC Bank decreases lending rates on certain tenures; EMIs of these loans would be Lowered Repayment of gold loans
Repayment of gold loans might vary with lenders. In SBI, the repayment mode is;Gold Loan (EMI based): Repayment of principal and interest will commence from month following the month of disbursement.
Bullet Repayment for Three Months Gold Loan: Interest and Principal on or before the end of term.
6 Months Bullet Repayment Gold Loan: Interest and Principal on or before end of term.
12 Months Bullet Repayment Principal and interest on a gold loan must be paid before the end of the period.
What is bullet payback in a gold loan?
This repayment method involves a quick and one time payment of interest and principal. “Under a bullet repayment plan, you have to repay both the interest and the principal amount right at the end of the loan’s tenure,” the HDFC Bank website states. You do not have to worry about any repayment of gold loan during the loan tenure at all. You can just make the full payment at the end of the loan term; you are not required to follow any EMI schedule.
The interest on the loan is calculated each month but becomes payable only at the end of the gold loan tenure. Since you repay the loan in a single shot, this form of repayment of gold loan is called a bullet repayment plan.” To obtain a suitable gold loan offer, check at the interest rates given by a few well-known lenders. Don’t get drawn in solely by the lender’s appealing interest rate.
Take into account extra terms like how interest and other fees are calculated. Use internet calculators to find the total cost of the gold loan over time rather than just the interest rate. Latest gold loan interest rates, processing fee charged by top 24 banks
Bank / NBFC Gold Loan Interest Rate Processing Fee
Kotak Mahindra Bank 0.88% Fixed Interest Rate per month Upto 2% + GST
Central Bank of India 8.40% to 9.50% 0.50% of loan amount
Uco Bank 8.50% Rs.250 to 5000 max
Indian Bank 8.80% to 9.00% 0.56% of the limit sanctioned
Federal Bank starting at 8.99%
Canara Bank 9.00% Rs.500 to Rs.5000
SBI 9.00% onwards 0.50% + GST
Baroda Bank 9.15% GST + applicable charges
ICICI Bank 9.25% to 18.00% 2% of loan amount
Bank of Maharashtra 9.30% Rs.500 to Rs.2000 + GST.
HDFC Bank 9.30% to 17.86% 1% of disbursal amount
Punjab & Sind Bank 9.35% Rs.500 to 10000 max
South Indian Bank 9.40% – 22.00%
City Union Bank 9.50% Nothing
AU Small Finance Bank 1.5% + GST from 9.50% to 24.00%
9.95% for Union Bank
Bank of Karnataka 10.00% to 10.45%
Indusind Bank 10.35% to 17.05% 1% of loan amount
10.50% to 19.45% Bandhan Bank 1% + GST
Karur Vysya Bank 10.65% 0.50% (including of Appraisal costs)
J & K Bank 11.35% Rs 500 + GST
National Bank of Punjab 12.25% 0.75% of loan amount
Axis Bank 17.00% 0.5% + GST
Finance by Muthoot 22% p.a. with 2% rebate if 100% interest is paid monthly
Information compiled by ETIG as of January 2, 2025.