'The amount you can raise via a gold loan is higher than you can get via a personal loan,' points out Sanjay Kumar Singh.
This is a good loan option to consider if you need money in an emergency as disbursal tends to be quick.
Lenders provide this loan for durations ranging from seven days to up to three years.
Compare the interest rates charged by various players.
They can range from 9.6% to 29%.
Take into account the processing fee as well.
It can range from 0.10% to 2% of the loan amount.
Since you are providing collateral, you should ideally be able to get a gold loan at an interest lower than on a personal loan.
But interest rate on a gold loan rises with tenure.
The amount you can raise via a gold loan is higher than you can get via a personal loan.
Banks and NBFCs usually restrict the loan-to-value ratio on a gold loan to 75%.
Check out the table below for rates and charges offered by key banks and NBFCs
|Rates and charges offered by key banks and NBFCs|
|Bank Name||Minimum loan amount||Maximum loan amount||Loan tenure||Interest Rate||Processing fee|
|South Indian Bank||Rs 5000||Rs 10 crore||3 months-3 years||
9.6%-14.65% (fixed rate)
10.85% (floating rate)
|Up to 0.10% of the limit sanctioned|
|Bandhan Bank||Rs 10000||No limit||6 months-3 years||16%||1% of loan amount|
|United Bank of India||Rs 25,000||Rs 10 lakh||1 year||9.90%||Rs 600-Rs 3,000|
|Muthoot Finance||Rs 1,500||No limit||Upto 3 years||12-26%||Up to 1% of loan amount|
|Manappuram Finance||Rs 5000||No limit||Upto 1 year||9.9-29%||Rs 10 (at the time of loan settlement)|
|Federal Bank||Rs 1000||Rs 1.5 crore||3 months-1 year||13.25%||Up to 0.40% of loan amount|
|Axis Bank||Rs 25,001||Rs 20 lakh||6 months-3 years||14.75-17.25%||1% of loan amount|
|Oriental Bank of Commerce||No limit||Rs 50 lakh||Up to 1 year||9.75-10.75%||Up to 0.50% of loan amount|
|State Bank of India||Rs 20,000||Rs 20 lakh||Up to 3 years||10.55%||0.5% of loan amount (Minimum Rs 500)|
|Kotak Mahindra Bank||Rs 25,000||Rs 25 lakh||3 months-3 years||10.5-17%||Up to 2% of the loan amount|
|Bank of Baroda||Rs 25,000||Rs 10 lakh||Up to 1 year||11.65% onwards*||0.5% of loan amount|
|YES Bank||Rs 25,000||Rs 50 lakh||3 months-3 years||15.85%||0.49% of loan amount|
|IIFL||Rs 3000||Up to 75% of the gold's market value||3-11 months||9.24-24%||Depends on scheme availed of|
|RBL Bank||Rs 10,000||Rs 50 lakh||7 days to 365 days||14.5-19%||Rs 100|
|* Bank of Baroda levies a strategic premium over and above the applicable interest rate, which depend upon customer's credit profile|