📖 Understanding Gold Loans in India

Gold loan is a secured loan where you pledge your gold jewelry or coins as collateral. It's one of the quickest ways to get funds with minimal documentation. Banks and NBFCs offer gold loans with interest rates ranging from 7% to 14%.

The loan amount depends on gold weight, purity, and current market rate. RBI has capped the Loan to Value (LTV) ratio at 75%, meaning you can get a maximum of 75% of your gold's value as a loan. For example, if your gold is worth ₹1 lakh, you can get up to ₹75,000 as a loan.

Gold loans are popular for short-term needs because of quick processing (often same-day), no income proof requirement, and lower interest rates compared to personal loans. The tenure is typically short, ranging from 3 months to 3 years.

You can repay through monthly EMIs, bullet repayment (principal + interest at end), or partial payments. If you fail to repay, the lender can auction your gold. Always borrow only what you need and have a clear repayment plan.