Gold loan FAQ

1. How are Gold Loans different from other loans like Personal Loan or Credit Card?
Gold loan is sanctioned by accepting the gold ornaments of the customer as pledge. Personal loan is sanctioned on the basis of source of income and repayment capacity of an applicant. It is true that Gold loans, like personal loans or credit card borrowings, are often used for short term household requirements. However, in terms of the cost and ease of availing the loan, and the convenience when repaying, gold loans are a better bargain. Personal loans and credit card borrowings are unsecured loans and therefore may carry a higher rate of interest. Moreover, personal loans require considerable effort in documentation formalities and they commit you to an inflexible EMI schedule for repayment. Gold loans, on the other hand, are cheaper and can be availed of in minutes. You can also stretch the repayment to your convenience; the only requirement is that you have to service the interest periodically. Credit card borrowings may be easier to avail than even gold loans but the interest rates are prohibitive and it can lure people into a debt-trap.

2. Who is eligible to avail Gold loans?
Anyone who owns gold ornaments can avail the loan. (Note: minors are not eligible.) To obtain the loan you need to submit your gold jewellery (within a karat range of 18 to 24 k) at the branch. The loan amount that is sanctioned will be based on the gold valuation which involves verification of its purity. The weight of stones etc. fixed on the ornaments will be deducted for the purpose of valuation.
3. What are the documents required for taking loan against gold ornaments?
Are there any end-use restrictions involved?We need one document of identity proof (such as ration card, driving licence, PAN Card, Voter ID card, passport etc.) and one document of residential proof. There are no end-use restrictions in gold loans.

4. What is the rate of interest charged on such loans? How is the interest calculated?
The interest rate is fixed and calculated on a reducing balance basis.

5. What is the tenor of such loans?
gold loan products have a maximum tenor of one year.

6. How long will it take for me to get my gold loan?
Approval within a matter of minutes provided everything is in order.

7. Are the pledged gold ornaments safe and secure?
Gold ornaments accepted as pledge by the customers are stored at strong cash safes

8. How do I repay my Gold loan?
You repay the loan at the end of the loan tenure. You do not have to go through hassle of servicing EMIs every month. However, interest has to be serviced periodically, as per the terms of sanction. Repayments can be made in cash, by cheque or DD.