|SBI Gold Loan Interest Rate||Details|
|Interest Rate||Starts at 9.15%|
|Processing Fee||0.50% on the loan value; minimum Rs. 500 applicable|
|Tenure||3 months to 36 months|
|Loan Amount||Rs. 20,000 to Rs. 20 lacs|
|Gold Loan Scheme||EMI, Overdraft, and Bullet Repayment Scheme|
State Bank of India (SBI) Gold loan Interest Rate is as low as 9.15% to 9.95%. You can apply for the loan against gold if over 18 years of age. The repayment schemes are flexible. Depending on the loan scheme, you can repay through monthly instalments, pay monthly interest on the amount drawn through overdraft, or pay monthly interest amount till end of tenure and then repay the entire principal borrowed amount.
In this post, we will discuss the State Bank of India gold loan interest rate, its features, interest rate calculation, other charges, gold loan rate per gram and factors which influence it, illustration of rate per gram, tips to get the best rate per gram, and FAQs.
Below given are features of State Bank Gold Loan Interest Rate:
The lowest SBI gold loan rate of interest is 9.15%. Several factors influence the calculation of the interest rate. These factors are the loan amount, tenure, LTV, relationship with SBI, and others. Below given are factors that influence SBI interest rate for gold loan:
|Factors Influencing SBI Gold Loan Interest Rates||Details|
• The loan amount depends on the net weight of gold in the pledged asset.
• The bank offers a per gram gold rate as per the gold purity. A higher per gram rate is offered for higher purity.
• The loan against gold SBI amount is between Rs. 20,000 and Rs. 20 lacs.
• The bank may offer a lower interest rate for a higher amount.
• State Bank may charge a lower interest rate on loans of higher tenure. It may also charge a higher rate of interest for loans of shorter tenure.
• SBI gold loan comes with tenure 3 months to 36 months.
• A shorter tenure will reduce the total interest pay-out. Choose tenure for the loan as per your repayment capacity.
|Purpose of the Loan||
• Almost every financial institution, including the State Bank of India offer gold loans for agricultural or farming activities. These loans come with concessional rates.
• Agriculture comes under priority sector lending target of the bank.
• For a gold loan for agricultural purpose, discount of 1% to 2% is applicable on the standard rate of interest.
|Loan to Value Ratio||
• The maximum LTV is 75% for a loan against gold. SBI offers up to 65% LTV for bullet repayment scheme.
• On the other hand, LTV of up to 75% is available for liquid gold loan and personal gold loan scheme.
• LTV depends on the purity and net weight of the gold in the jewellery. Interest rate is lower for lower LTVs, and vice-versa.
|Relationship with the Bank||
• The bank may offer concessional or lower interest rate for regular or existing customers.
• These customers should have a proven track record with the bank about payments on time in the past.
Apart from the interest rate, the bank may apply other fees and charges on a loan against gold. These charges include:
The SBI gold loan per gram is the best in the market. It is based on the purity of the gold and the gold price as per the loan to value ratio (LTV) The price per gram offered by the bank is between Rs. 2,574 and Rs. 3,146. However, the rate shall change as per the bank’s discretion. The highest loan rate per gram for 22 carat jewellery as per 75% LTV is Rs. 3,146. The same shall fluctuate as per the gold price on the current day.
Estimate of SBI Gold Loan Value
|Factors that Influence SBI Gold Loan Value||Details|
|Net Weight and Purity of Gold||
• Every financial institution has an in-house valuer to estimate the net weight and purity of the gold content in a pledged asset.
• The expected gold purity is 18 carats to 24 carats. The bank will subtract the weight of stones, gems, or other precious materials other than gold in the jewellery and then calculate the actual weight of gold in the jewellery.
• The net weight and purity of gold details are provided in a formal letter issued by the in-house valuer.
• After estimating the net weight and purity of gold in the pledged asset, the bank multiplies these details to the current gold price. The results tell you the gold value.
• As per the guidelines of RBI, the last 30 days average price for 22 carats gold is adjusted for estimating the gold purity.
• Thus, the State Bank applies the 30 days average multiplied by a factor of 20/22 carat to understand the gold’s value.
|LTV or Loan to Value Ratio||
• SBI offers a maximum loan to value ratio up to 75%. Thus, the bank retains a minimum margin of 25% when disbursing a loan against gold.
• Depending on the gold loan scheme, loan amount, tenure, purity and net weight of the gold, the bank will determine the LTV and applicable interest rate.
• Usually, if you need a higher loan amount than what you are eligible for, a higher margin is retained by the SBI.
Based on LTV 65% to 75%, the State Bank of India provides the following lowest and the best gold loan rate per gram. The results are based on the average of the last 30 days.
Consider Anil, Vinod, and Dinesh visit the State Bank of India branch with jewellery to avail a gold loan. All the three individuals have varying net weight gold or different purity levels. Below, we have discussed the gold loan eligible amount based on LTV 75%, the gold purity and net weight.
|Purity of Gold in Carats||Gold Net Weight||Eligible Loan Amount|
|Anil has 22 carats of gold||50 grams||Rs. 1.59 lacs|
|Vinod has 20 carats of gold||60 grams||Rs. 1.73 lacs|
|Dinesh has 18 carats of gold||70 grams||Rs. 1.82 lacs|
State Bank of India accepts non-hallmarked as well as hallmarked gold jeweller for the loan. But, the highest per gram rate is reserved for hallmark jewellery. This reduces the chances of under-valuation, if any. A lower processing fee is also applicable for hallmarked ornaments. Below given are tips to avail the best loan against gold amount per gram:
Below mentioned are FAQs on gold loan SBI interest rate:
The starting rate of interest is 9.15% for personal gold loan SBI. The applicable interest rate will depend on the gold purity and weight. Other factors which may influence the rate of interest are loan amount and tenure, along with the repayment capacity of the borrower.
The starting interest rate is 9.95% for multipurpose gold loan SBI. The rate of interest depends on the gold net weight and purity. The type of gold and repayment capacity of the borrower will be considered to determine other factors such as the loan amount and tenure.
If you take agricultural gold loan from State Bank, then you can expect a concession of 1% to 2% on the standard rate of interest. You need to provide proof of land and farming activity to the bank. The LTV for such type of loan could be different than that applicable on other SBI gold loan schemes.
Yes, the bank offers discount on standard interest rate to regular or existing customers. However, to get a concession on the loan against gold rate of interest, the customer should have a history of consistent repayments with the bank. The borrower should have a proven track record on a previous loan with SBI.
To get the lowest possible rate of interest on State Bank gold loan, follow the below mentioned tips:
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