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Gold Loan Interest Rates

Current Gold Loan Interest Rate 2021

Last Updated 29th Jul 2021

Bank NameGold Loan RatesLowest EMI Per Lakh
HDFC Bank 9.50% ₹ 4,591
Manappuram 9.90% ₹ 33,885
Yes Bank 9.99% ₹ 3,226
Fincare Small Finance Bank 10.99% ₹ 11,626
IndusInd Bank 11.50% ₹ 4,684
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Compare Gold Loan Rate Per Gram of Banks

Bank Gold Loan Interest Rates Processing Fee Max Tenure
SBI Gold Loan Interest Rates
Compare
7.30%0.50% of the loan amount, minimum-₹ 500 36 months
Muthoot Gold Loan Interest Rates
Compare
11.99%0.25% to 1% of loan amount.36 months
Manappuram Gold Loan Interest Rates
Compare
9.90%₹ 10 (to be paid at time of settlement)3 Months
HDFC Bank Gold Loan Interest Rates
Compare
9.50%1% of the loan amount24 months
Yes Bank Gold Loan Interest Rates
Compare
9.99%0.48% of loan amount36 months
ICICI Bank Gold Loan Interest Rates
Compare
9.00%1% of the loan amount12 months
Federal Bank Gold Loan Interest Rates
Compare
8.50%Nil12 months
Canara Bank Gold Loan Interest Rates
Compare
7.35%0.5 of the loan amount, Min ₹ 1,000 and Max ₹ 5,00012 months
Andhra Bank Gold Loan Interest Rates
Compare
7.60%Nil processing fees12 months
Axis Bank Gold Loan Interest Rates
Compare
13.50%Upto 0.5%24 months
IndusInd Bank Gold Loan Interest Rates
Compare
11.50%Upto 1% of loan amount, minimum ₹ 75024 months
PNB Gold Loan Interest Rates
Compare
8.75%0.70% of loan amount + taxes12 months
Fincare Small Finance Bank Gold Loan Interest Rates
Compare
10.99%Upto 0.5%9 Months

Lowest Interest Rate on Gold Loan

As per the current rates, Manappuram, HDFC Bank, Yes Bank, IndusInd Bank, Fincare Small Finance Bank give the lowest gold loan interest rates in the range of 9.50% to 11.5%. HDFC Bank offers the lowest rate starting at 9.50%. The interest rate on the gold loan is dropped by 0.4% from the previous rate, which was last revised on 11 Feb, 2021. Refer to the table below to understand the rate trend of the top banks offering the lowest gold rate.

Bank Name Current Rate Previous Rate Rate Difference
HDFC Bank 9.50% 8.95% 0.55%
Manappuram 9.90% 12.00% -2.1%
Yes Bank 9.99% 12.99% -3%
Fincare Small Finance Bank 10.99% 12.99% -2%
IndusInd Bank 11.50% 10.50% 1%
Muthoot 11.99% 12.00% -0.01%

Similarly, based on a comparison of processing fees, Federal Bank, Andhra Bank are the best banks to take loan against gold as they charge Nil processing fee on gold loans.

Current Gold Loan Interest Rates as on 29 Jul 2021

Gold Loan Rates in Government Banks

Public Sector Banks Interest Rates Repayment Schemes
SBI 7.30% - 7.50% Bullet Repayment
Canara Bank 7.35% Bullet Repayment
Andhra Bank 7.60% - 9.10% Bullet Repayment
PNB 8.75% - 9.00% EMI Scheme / Bullet Repayment / Overdraft

Gold Loan Rates in Private Banks

Private Sector Banks Interest Rates Repayment Schemes
HDFC Bank 9.50% - 15.00% Bullet Repayment / Overdraft
Yes Bank 9.99% EMI Scheme / Bullet Repayment / Overdraft
ICICI Bank 9.00% - 19.76% EMI Scheme
Federal Bank 8.50% - 11.95% Bullet Repayment / Overdraft
Axis Bank 13.50% - 16.95% EMI Scheme / Bullet Repayment
IndusInd Bank 11.50% - 16.00% Bullet Repayment

Gold Loan Rates in NBFCs

Gold Loan NBFCs Interest Rates Repayment Schemes
Muthoot 11.99% - 11.99% EMI Scheme / Bullet Repayment
Manappuram 9.90% - 29.00% Bullet Repayment

Agriculture Gold Loan Rates

Gold Loan NBFCs Interest Rates Repayment Schemes
SBI 7.30% - 7.50% Bullet Repayment
ICICI Bank 9.00% - 19.76% EMI Scheme
HDFC Bank 9.50% - 15.00% Bullet Repayment / Overdraft
Yes Bank 9.99% - 9.99% EMI Scheme / Bullet Repayment / Overdraft
Axis Bank 13.50% - 16.95% EMI Scheme / Bullet Repayment

Gold Loan Processing Fees and Charges

Apart from interest rates, a gold loan involves various fees and charges that are imposed for the course of processing, disbursement and sanctioning of the gold loan. Some of these fees and charges involved in a gold loan are listed as follows:

  • Gold Loan Processing fees – Along with interest rates, most banks charge a processing fee on gold loans. The processing fees of upto 1% of loan amount is charged to process the loan application. Some banks may also offer NIL processing fees such as Federal Bank and IIFL.
  • Gold Loan Prepayment and foreclosure – When you want to repay your loan partially before time, it is called part prepayment. In case you decide to pay the entire loan amount before time, it is called foreclosure. Banks typically levy prepayment or foreclosure charges in such situations and these can range from nil to even upto 1%. So, check carefully if the low interest rate gold loan you are getting comes with high prepayment or foreclosure charges. Some loans also come with a lock-in-period and cannot be repaid before time.
  • Gold Valuation Charges – Valuation charge is the fee charged by the gold loan lender for evaluating the purity of the pledged gold loan in terms whether the gold holds the purity mark of 18 carat to 24 carats with hallmark.
  • Stamp Duty – The stamp duty charge is charged for the transference of ownership of tangible assets, whether gold or real estate property. The stamp duty charge differs across all states.
  • Late Payment Charges –  Penalty charges is not a compulsory charge, but it is charged only when you fail to pay the gold loan EMI as per the repayment schedule. Thus, the penal charge is charged on the failure of repayments on a monthly basis.
Bank Name Processing Fee Foreclosure Charges Gold Valuation Charges Penalty
HDFC Bank 1% of the loan amount 1% + applicable tax Rs. 250- Rs.575 2% per month on overdue amt
SBI 0.50% of the loan amount, minimum-₹ 500 NIL NA NA
Muthoot 0.25% to 1% of loan amount. NIL NA 0.16% per month on overdue amt
Manappuram ₹ 10 (to be paid at time of settlement) NIL NA NA
Yes Bank 0.48% of loan amount 1% NA NA

How to Get Gold Loan at Lowest Interest Rate?

Gold loans are secured loans and the loan is sanctioned based on the gold you pledge. Most of the banks offer low interest rates for a high loan amount. Keep in mind the following factors that affect gold loan rate to be able to get the lowest interest rate:

  • Special offers – Always check current offers and interest rates offered by various banks as banks run special schemes on a periodic basis.
  • Compare bank offers for various loan amounts – Typically, banks offer low interest rates at higher loan amounts and vice versa. Further, the interest rates offered by NBFCs are typically higher as they give small loan amounts with flexible and quick service.
  • Type of loan taken – Generally, loan against gold taken for agricultural purposes are offered at lower interest rates. Similarly, if you are planning to avail of an overdraft facility against gold, you may be required to pay a high-interest rate but only on the utlilized amount.
  • Loan to Value Ratio – Higher the loan to value ratio, higher is the interest rate charged. Most of the banks lend upto 75% of the gold value as loan.
  • Existing bank account holder – At times, gold loans are offered at an affordable interest rate to the existing customers of the bank. Therefore, if you have an existing savings account, an FD or a loan account with the bank, then you may get a loan against gold at low rates.

Gold Loan Interest Rate Calculator

Gold Loan interest rate calculation can be done using flat rate or reducing balance method. All leading banks and NBFCs in India calculate interest rate on gold loans using the reducing balance method. A flat rate of interest is always costlier than a loan taken on reducing balance. Let us understand both the terms:

  • Flat Rate Method: According to the flat rate method, the gold loan rate is calculated on the original loan amount throughout the loan tenure. Thus the principal amount remains the same.
  • Reducing rate method: As the name suggests, the interest rate is calculated on the outstanding gold loan amount. As per this method of interest calculation, the interest amount reduces with time.

The functioning of the above-mentioned methods can be understood with the help of the following table:

Parameters Flat Rate Method Reducing Balance Method
Loan Amount ₹ 5 Lakh ₹ 5 Lakh
Tenure 24 months 24 months
Interest Rate 10.50% p.a. 10.50% p.a.
EMI ₹ 25,208 ₹ 23,188
Total Interest Payout ₹ 1,05,000 ₹ 56,512
Total Amount Paid ₹ 6,05,000 ₹ 5,56,512
Savings -- ₹ 48,488

FAQs

Are interest rates on loan against gold increased?

No, the lowest gold loan rates have been decreased by 0.4% from 9.9% to 9.50% on 11 Feb, 2021. As per the current rates, HDFC Bank is offering loan against gold at the lowest rate of 9.50%.

Which bank is best for gold loan?

HDFC Bank is the best bank for a gold loan as it provides gold loan at lowest rates starting at 9.50%. Federal Bank, Andhra Bank are some other banks that can be considered best banks for a gold loan as they charge nil processing fee on a gold loan.

What is the current interest rate for gold loans?

As per the current rates, HDFC Bank provides lowest gold loan rates starting at 9.50%. However, the interest rate may vary based on your loan amount. Apply for a gold loan that you are eligible for to get the best rates.

How does Repo Rate affect the interest rate of gold loans?

The repo rate is directly proportional to floating rate gold loan. With the cut in repo rate,the lending institutions also lowers the gold loan rates. When the gold loan is offered at a fixed rate, the repo rate does not have any impact on gold loan rates.

How is gold loan interest calculated?

You can calculate the gold loan interest by subtracting the principal amount from the total amount to be paid. The total amount you would pay by the end of tenure can be calculated with the help of an EMI calculator.

What is interest free gold loan?

As the name suggest, interest free gold loan is the credit facility where the lender does not charge any extra amount in the form of interest rate. This gold loan helps in meeting the urgent financial requirement without any extra cost. Currently, Muthoot Finance offers the interest free gold loan facility.

What is the EMI for ₹ 20 Lakh Gold Loan?

The EMI on any credit facility depends upon the interest rate and the loan tenure. Assuming the lowest interest rate of 9.50% and loan tenure of 36 months the Equated monthly installemt on loan amount of ₹ 20 Lakh will be ₹ 64,066 .

What are the documents required for availing Gold Loan?

The documents required for availing gold loan are:-

  • Two passport size photograph
  • Identity proof (PAN card/ passport/ Aadhaar card/ voter id card)
  • Address proof (Electricity bill/ telephone bill/ bank statement)

What will the bank do if the gold prices fall during the tenure of Gold Loan?

In case of sharp decline in gold prices, banks may do the following:

  • The Bank might ask for more collateral or gold to maintain the LTV
  • The Bank might request the you to partly pay a nominal amount which goes towards the principal
  • In rare cases, if you fail to make this payment, the gold can be auctioned after giving due notice period and multiple reminders.

Gold Loan Reviews 4.7/5  by 399 customers
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Vikash, Jamshedpur
Reviewed on 23rd Jul 2021
5 / 5 stars
HDFC Bank Gold Loan Availed in Jul 2021

Very good response by the bank team and Mr. Kanchan Gorai. The team is customer friendly in HDFC BanRead more...

C Redapp, Bangalore
Reviewed on 13th Jul 2021
4 / 5 stars
HDFC Bank Gold Loan Availed in Jul 2021

Very good service by MyLoanCare as well as by the bank staff. In the times of pandemic, very good soRead more...

Radhe, Delhi
Reviewed on 29th Jun 2021
5 / 5 stars
HDFC Bank Gold Loan Availed in Jun 2021

Great Experience, delivered what promised, service so quick.Read more...

Swapnil, Pune
Reviewed on 22nd Jun 2021
3.5 / 5 stars
HDFC Bank Gold Loan Availed in Jun 2021

Good service, I like it. Read more...

Prerna, Gurgaon
Reviewed on 02nd Jun 2021
5 / 5 stars
HDFC Bank Gold Loan Availed in May 2021

Excellent services provided by MyLoanCare. Got the loan sanctioned very easily.Read more...

Vikas, Ghaziabad
Reviewed on 02nd Jun 2021
4 / 5 stars
HDFC Bank Gold Loan Availed in Jun 2021

Good

ROHIT, Delhi
Reviewed on 02nd Jun 2021
5 / 5 stars
HDFC Bank Gold Loan Availed in Jun 2021

Good experience.
Fast service.
Will recommend others also. Read more...

Prashanth, Hyderabad
Reviewed on 27th May 2021
5 / 5 stars
HDFC Bank Gold Loan Availed in May 2021

MyLoanCare has helped to take the Gold loan with HDFC Bank in a very convenient and easy way.Read more...

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*Terms and conditions apply. Credit at sole discretion of lender, which is subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and collected from public sources. Read More
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