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Read On To Know Things You Must Know Before Applying For Gold Finance

A gold loan has the potential to become the perfect solution for all your financial emergencies. Gold loans can provide you with instant cash at lower interest rates as compared to other kinds of credit options. Multiple lenders are offering gold loans at interest rates varying from 10 – 12% per annum, which is much lower as compared to personal loans, business loans, etc. A gold loan, being a secured loan, requires minimum documentation, thus providing a quick verification process. The organized gold loan market has grown by 30% from 2010 to 2019.


Gold loans, falling into the category of secured loans, do not require the applicant to submit any documentation. This is because the gold lender already possesses the gold of the borrower as security against the sanctioned loan amount. This also makes the whole process a lot less cumbersome.

Time to disburse the gold loan amount

Since gold loans can be approved with a bare minimum documentation requirement, it also makes the verification process very fast. Since there are very documents to verify, the loan amount is disbursed pretty quick, usually within a day.

No biasing based on credit score

A credit score or CIBIL score is a three-digit score ranging from 300-900 offered to an individual based on their credit history. Unlike personal or business loans in which the lenders prefer individuals with a higher CIBIL score, lenders do not consider the individual’s credit score while offering gold loans. Hence, applicants of instant cash for gold loan can get the approval irrespective of their credit score.

Minimum restriction on age

Any individual who is at least 18 years and at most 75 years old is eligible to apply for a gold loan unlike personal loans and business loans where the age bar is set to 21. Anyone within this age range and can apply for cash for gold.

Rate of interest

Gold loans come at affordable interest rates.The interest rates are affordable differ from lender to lender on baisis of amount required. To find the most lucrative cash for gold scheme, you need to compare multiple gold finance schemes. You can find a gold loan interest calculator online that can help you figure out the overall interest that you will be required to pay for the sanctioned cash for gold. All you need to do is select the gold loan amount, the rate of interest charged, and the loan tenure.

Repayment options

The gold loan can either be repaid all together at the end of gold finance tenure or in equated monthly installments. In case you want to go for the EMI option, gold loan EMI calculator can tell you the exact equated monthly installment that you need to pay every month.

Gold criteria

The gold pledged by the borrower as collateral to the gold lender needs to be worth 18 – 22 carats. The purest form of gold exists in 24 carats, but it is found in liquid state. It is alloyed with other metals in different ratios to get shape in the solid-state. Only gold items with proportions of 18:6 and 22:2 are allowed to be pledged, and the overall value is calculated in 22 carats equivalent.

Maximum disbursed loan amount

As per the latest revised rule of Reserve Bank of India, the loan-to-value ratio (LTV) cannot exceed 75%. Let us take a real-world example to understand this better. If the value of the gold pledged as collateral by the borrower is evaluated to be Rs.10,000, the individual can only get a loan amount of Rs. 7,500. This is done considering the frequent fluctuation of the price of gold in the market.

Using the above points, you can find the best gold finance that suits your requirements. When you’re in need of money urgently, take your time to choose the right lender. After all, it is your gold that acts as collateral in the process.

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