Turn Your Gold Into Useful Funds.
A gold loan lets you borrow against eligible gold jewellery without selling it. Understand gold valuation, eligibility, loan-to-value, interest rates, documents and repayment before you pledge your jewellery.
Loan amount, interest rate, LTV, tenure and charges vary by lender and product.
A practical way to borrow against eligible gold jewellery.
A gold loan is a secured loan in which eligible gold jewellery is pledged to a lender as collateral. The lender evaluates the gold and determines the amount that can be offered according to the applicable product terms and valuation process.
The loan amount is not automatically equal to the purchase price or retail value of jewellery. Gold purity, eligible weight, valuation methodology and applicable loan-to-value requirements can affect the amount offered.
A gold loan may be considered when an individual already owns eligible gold and needs funds without taking an unsecured loan. However, the convenience of secured borrowing should be balanced against interest, fees, repayment obligations and the consequences of default.
Ask the lender how the gold is valued, what LTV applies and what total amount you will have to repay.
Four steps from gold valuation to repayment.
The process is simple, but every step can affect the amount borrowed and the terms of the loan.
Application
Submit the application and provide the KYC and other documents requested by the lender.
Gold Valuation
The lender evaluates eligible gold based on its appraisal process, including purity and eligible weight.
Loan Approval
The lender determines the eligible loan amount, interest, tenure and applicable charges.
Repayment
Repay according to the agreed terms and complete the closure process to recover the pledged gold.
How much gold loan can you get against your jewellery?
The amount available against gold depends on the lender's assessment and applicable loan-to-value requirements. You should not assume that the entire retail value of your jewellery can be borrowed.
Gold jewellery can contain stones, alloys and other non-gold components. The appraisal therefore considers eligible gold content rather than simply using the original purchase price.
Purity and net eligible gold weight are also important. Different lenders may use different valuation processes, which can result in different eligible loan amounts for similar jewellery.
Before accepting an offer, compare the sanctioned amount with the total repayment obligation. A higher loan amount is not necessarily the better choice if the overall borrowing cost is higher.
What can affect your gold loan eligibility?
Eligibility criteria vary between lenders. These are the key areas borrowers should understand before applying.
Age & KYC
The applicant needs to meet the lender's age and identity verification requirements.
Eligible Gold
The lender determines which jewellery or gold assets can be accepted as collateral.
Gold Purity
Purity is an important part of determining the value of pledged gold.
Gold Weight
Eligible net gold weight can differ from the jewellery's total gross weight.
LTV Requirements
The eligible loan amount is subject to applicable LTV requirements and lender policy.
Lender Policy
Interest rates, tenure, fees and documentation can vary between lenders.
Documents you may need for a gold loan.
The exact gold loan document checklist depends on the lender and applicant. Always confirm current requirements before applying.
Identity Proof
A government-approved identity document may be required for KYC verification.
- PAN card
- Aadhaar or accepted ID
- Passport
- Other accepted identity proof
Address Proof
The lender may request proof of your current residential address.
- Aadhaar
- Passport
- Accepted utility document
- Other lender-approved proof
Photographs
Recent photographs can form part of the application and KYC process.
- Recent photographs
- Applicant photograph
- Additional photographs if requested
Understand the repayment structure before you borrow.
Gold loan repayment structures differ by lender and product. Do not assume that every gold loan follows a standard EMI structure.
Compare the complete cost, not just the interest rate.
The overall cost of a gold loan can include several components. Read the lender's schedule of charges before accepting the loan.
Interest Rate
Check the applicable annual interest rate and how interest is calculated.
Processing Fee
A processing fee and applicable taxes may be charged by the lender.
Appraisal Charges
Gold valuation or appraisal-related charges may apply depending on the product.
Overdue Charges
Understand the consequences and charges associated with delayed repayment.
Fast access to money still requires careful repayment planning.
Because gold is pledged as security, borrowers should understand the consequences of missed payments before taking a loan.
Do not borrow the maximum amount simply because it is available. Consider your repayment capacity, total borrowing cost and the time required to close the loan.
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Common questions before pledging gold.
These answers explain the basic concepts borrowers should understand before applying. Actual terms depend on the lender and loan agreement.
A gold loan is a secured loan where eligible gold jewellery or another accepted gold asset is pledged as collateral. The lender assesses the collateral and determines the eligible loan amount according to its applicable terms.
The eligible amount can depend on gold purity, eligible weight, the lender's valuation methodology and applicable loan-to-value requirements.
Yes. Purity is an important part of gold valuation and can affect the eligible value of pledged gold.
Common requirements may include identity proof, address proof and photographs. The exact checklist varies by lender and applicant.
Consequences depend on the loan agreement and lender process. Delayed repayment can result in additional charges and continued default can lead to action against pledged collateral.
After applicable loan dues are cleared and closure requirements are completed, the pledged gold is released according to the lender's process.
Yes. Compare interest rates together with processing fees, valuation charges, repayment structure, tenure and overdue charges.
Before pledging your gold, understand the complete loan.
Compare the eligible loan amount, valuation method, interest rate, processing charges, repayment structure, tenure and default conditions before making your decision.
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