Gold Loan Interest Rates

Gold Loan

Loan Details

Gold Loan Interest Rate

13 Starts at 10.50%

Loan Amount

Up to 75% of the gold current market value


1 day to 36 months

Processing Fee

Up to 2% of loan amount

Gold Loan Per Gram

Between 2,292 and Rs. 2,801 determined by the gold?s quality and weight

Gold loan interest rates start at 10.50%. The loan schemes come with several repayment options such as overdraft scheme, bullet repayment scheme, and EMI (equated monthly instalment). Loan amount is up to 75% of the gold?s actual market value. The quantum of loan to value ratio (LTV) can be lower than 75%, depending on the norms of the financial institution. The loan amount and gold loan rates depend on the quality (carat), weight, and LTV of gold. Tenure of the loan is determined by your (borrower) repayment capacity.

At Loanbaba, you will receive all the details of the jewel loan with top banks and NBFCs in India. You can also apply for a loan against gold on our website.

Gold Loan Interest Rates in India updated on

Below mentioned are the top banks and NBFCs for gold loans in India.

Bank Loan Amount Gold Loan Interest Rates* Lowest EMI per lakh for Max Tenure
Catholic Syrian Bank Gold Loan Up to Rs. 50 Lakhs 9.10% to 13.50% 12 Months
State Bank of India Up to Rs. 50 Lakhs 7.50% 36 Months
HDFC Bank Up to Rs. 1 Crore 9.90% to 17.90% 24 months
ICICI Bank Up to Rs. 1 Crore 11% 12 Months
Axis Bank Up to Rs. 25 Lakhs 13% 36 Months
Andhra Bank Up to 75% of the pledged gold One-year RLLR + 2.00% 12 months
Muthoot Finance Up to Rs. 5 Lakhs or no maximum limit 12.00% onward 36 Months
Canara Bank Up to Rs. 20 Lakhs 7.65% 12 months

Best Banks to Apply Gold Loan

As per comparison of gold loan rates by banks and NBFCs, we come to the conclusion that HDFC Bank, SBI, Andhra Bank, IndusInd Bank, and Yes Bank offer the lowest rate of interest between 10.50% and 11.5%. Also, comparison of processing fees by financial institutions reveal that Federal Bank, IIFL, and Andhra Bank offer the lowest fee on loans against gold. The rate of interest charged depends on many factors, including the type of jewellery loan scheme. You can enquire about the loan schemes with financial institutions, before choosing one.

Gold Loan Interest Rates Calculator

Rate of interest is charged based on the loan tenure and borrowed amount. As understood, currently the lowest rate is 10.50%. But a gold loan interest rate calculator and calculations takes into account various factors to determine a rate, as mentioned below:

  1. Loan to Value Ratio: As per the norms of RBI, financial institutions can provide up to 75% of gold?s market value as loan amount. Depending on the jewel loan scheme, gold?s weight, and quality a LTV is decided. A higher LTV is offered for purer and heavier gold and vice-versa.
  2. Loan Amount: Usually, the rate of interest is lower for a higher loan amount, and vice-versa. So, the purer the gold, higher will be the amount provided, and lower shall be the rate of interest.
  3. Loan Tenure: The EMI amount depends on the loan tenure and the rate of interest. If you choose a longer tenure, the interest payout will be higher, compared to one on a shorter tenure.
  4. Type of Loan: Financial institutions usually offer discounted rate of interest on loans against gold for agricultural purpose or funds granted women to start a business, etc.
  5. Relationship with the Financial Institution: Banks and NBFCs may offer a lower gold interest rate to existing customers and account holders. The loan application by such customers is also processed faster, as the institution may already possess the required documents of the borrower.

Types of Interest Rates for Gold Loan

Below mentioned are the gold loan interest rate types:

  • The interest rate on gold is generally fixed. It means the interest rate remains static through the loan tenure, and does not change. In such cases, the interest component which you pay is unaffected by market conditions.
  • Every bank or NBFC may have a base rate for the gold loan, upon which added interest amount can be charged. The rate of gold will be estimated as per loan to valuation.
  • Some banks and NBFCs may apply floating interest rate on loan against gold. This means the rate of interest may change as per market fluctuations. The interest amount may increase or decrease as per the market conditions through the loan tenure.

How to Get Better Interest rates on Loan against Gold?

You can get better rates on gold loan by following the below mentioned ways:

  • If you are an existing customer of the bank or NBFC then you can use the relationship of trust you already have with this financial institute, and negotiate for better offer and interest rate. You can repay the loan faster and thus save on the interest payout on your loan against gold online.
  • Quality of the gold may also influence the interest rate. Purity of gold is thus an important factor in getting you best gold loan interest rate.
  • Some banks can provide overdraft facility for loan against gold, and this can help you get discounted rates.
  • If you belong to economically weaker section, agriculture field or such special category, then you can take government gold loan schemes, which offer lower rates of interest.

Types of Gold Loan Schemes in India

The jewel loan schemes are categorized based on the end purpose of the funds. Below-given are the most common jewellery loans.

  1. Agricultural Jewel Loans: Such loan schemes are meant to fund farming and agricultural activities against gold jewellery submitted as collateral. Such loan scheme comes under priority sector lending and carries several benefits for the borrower, including flexible repayment options.
    • Here, the borrower has to submit evidence of farming activity to obtain the funds.
    • Those eligible to apply for funds can get the loan at a discounted rate of interest, ranging between 8% and 10%.
    • Maximum tenure of such loans is up to 3 years. Banks monitor the end use of the funds.
    • Overdraft loan facility is also available.
    • The fund is usually used for crop production and investment into allied agricultural or actual farming activities.
  2. Non-Farming Loan against Gold: These loans are for every individual who is a professional, salaried, self-employed, female, businessperson, housewife, retired official, etc. The funds can be used for personal and business expenses, but not for farming purposes.

Documents Required to Apply for Gold Loan

Below-given is a list of documents needed for a loan against gold application.

Identity Proof (any one of the mentioned) PAN Card/ Aadhar Card/ Voter?s ID Card/ Passport Copy
Address Proof (any one of the mentioned) Rent agreement/ Passport/ Driving License/ Utility Bills/ Aadhar Card/ Voter?s ID Card
Other Requirements Your 2 recent passport-sized photographs with duly filled and signed loan application form

Frequently Asked Questions about Gold Loan Rates and Loan Schemes

elow-mentioned are FAQs about gold loan interest rates and schemes.

You can apply for a jewellery loan either offline at a bank/NBFC branch or online on the website of the financial institution or an aggregator such as Loanbaba. Some of the banks and NBFCs have their own mobile app, which allow you to not only apply for the funds, but keep track of loan application, checking balance of funds, and even complete the repayment through the app.

This is the most common repayment option for jewellery loans. Here, you have to repay the entire principal amount at the end of the tenure. During the tenure, you need to pay an interest amount in instalments. Interest is calculated on a monthly basis and is to be paid as EMI every month. This scheme is provided for short-term loans.

Though not the most popular repayment scheme for jewel loans, it can be opted for longer tenure schemes with high loan quantum. Here, you have to pay a portion of interest and principal amount as instalment every month on a particular date till the end of tenure. Maximum tenure is 4 years. So, by the end of the tenure, you would have paid the entire loan amount and interest, completely. Banks and NBFCs call for 6 months PDCs for the instalments, while others are exempt from PDC for larger loan amounts.

Overdraft gold scheme is for self-employed individuals and businesspersons with fluctuating requirements of funds. The loan comes in all ticket sizes but more suitable for larger loan quantum. Here, you can withdraw any fund amount or deposit surplus funds in account within a pre-approved credit limit. You can renew the credit limit at the end of tenure after payment of processing fees. The rate of interest charged is only on the amount of funds used at any given point of time.

In case you want to pay the entire or part of the loan amount before the tenure, then you can do so. If you choose to pay partly, then it is called part prepayment. If you want to pay off the entire outstanding amount, then it is called foreclosure. NBFCs and banks may levy a charge in both the scenarios. The fee can be up to 1% of the outstanding amount. Some financial institutions charge no foreclosure and prepayment fee at all if the repayment is done after a few EMIs. But some of the loan schemes come with a lock-in period until which you cannot repay the funds.

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Gold Loan