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HDFC Gold Loan Interest Rate

Last Updated 07th Oct 2017

HDFC Bank Gold Loan Interest Rates Oct 2017

Gold Loan Interest Rate
Interest Rate 11.00% - 14.50%
Check Best Offers
Processing Fee 0.50% to 1.00%
Loan Tenure 6 months to 24 months
Loan Amount Rs. 25,000 and Rs. 5,000,000
Repayment Options EMI Scheme, Bullet Repayment Scheme, Overdraft Scheme
Prepayment Charges Option from Nil to upto 1%
Penal Charges 2.00% per month
Apply Gold Loan @ 10.50%*
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HDFC Gold Loan

Gold Loans are loans availed by pledging your gold ornaments with a bank. HDFC gold loan can be taken for meeting urgent personal expenses like children education, marriage and other financial emergencies in the family as well as for business purposes. The gold mortgaged itself acts as a security to the loan. Taking a loan from HDFC has the following benefits:

  • Maximum loan amount limited to Rs. 5,000,000
  • Nil Processing Fee and Foreclosure charges in specific cases

Gold loan interest rate of depends upon

  • Loan Amount: The amount of gold loan you can avail depends the weight of jewelry you can pledge with the bank. Generally, banks offer a jewel loan per gram of gold which differs by the purity of gold and loan to value ratio offered. Banks offer lower interest rates for higher amount. HDFC Bank offers loan between Rs. 25,000 and Rs. 5,000,000 amount.
  • Relationship with the Bank: HDFC Bank offers special rates, offers and charges to the existing account holders of the bank. Those who have made their payments on time in the past can get the benefit of low gold loan interest rate from HDFC Bank. Bank offers jewel loan at rates of 11.00% to 14.50%.
  • Loan tenure: Many banks charge higher rate of interest for gold loans of lower tenure and lower interest rate for gold loans of higher tenure. HDFC Bank offers gold loan with a tenure of 6 months to 24 months.
  • Loan to Value ratio: Maximum loan to value ratio on gold jewelry has been fixed at 75% by RBI. However, HDFC Bank also offers loans at lower LTVs. Interest rate on loans with lower LTV will be lower compared to loans with higher LTV. Maximum LTV offered by HDFC Bank is 75% calculated on net weight of gold in your jewelry.
Other Charges

In addition to interest rates, Gold loan HDFC Bank also carry some other charges which include:

  • Processing fees – HDFC Bank charges minimum processing fees 0.50% to 1.00%. To get lowest fee, gold loan interest rates comparison, offers and cashback applying online through MyLoanCare.
  • Prepayment and foreclosure – Banks typically levy prepayment or foreclosure charges i.e. Option from Nil to upto 1%.

HDFC Gold Loan per gram

Your gold loan amount eligibility is measured in terms of gold loan rate per gram you will get on the basis of the weight and gold price of your jewelry adjusted for loan to value ratio.

Gold loan per gram is determined by multiplying the weight of gold by price of gold as adjusted for purity and LTV (loan to value) offered by HDFC Bank. For a 22 carat gold jewelry of 10 gram and a maximum LTV of 75% you can get a gold loan per gram of Rs. 2,124 from HDFC Bank

The table below gives the key loan parameters of Gold Loan HDFC Bank

Eligibility Criteria
Age Any individual with an age of 18 years and above
Profession Salaried, self-employed professionals and businessmen. Gold loans are available for agriculture and non-agriculture purposes
Loan Amount Rs. 25,000 to Rs. 5,000,000
LTV Upto 75% of gold. Some schemes are offered at lower LTVs as well
Quality of gold Gold ornaments should range in between 18 to 24 Carats
Type of gold accepted as security Gold ornaments with 18 carat purity and bank's special minted coins upto 50 grams weight
Gold Price Average gold price of 22 carat gold of past 30 days. Average price of 10 gm 22 carat gold for past 30 days is Rs. 28,320

Your loan eligibility calculated as gold loan per gram for HDFC Bank is calculated based on the following parameters:

  • Quantity and quality of gold pledged: Gold loan per gram depends upon the weight and assessment of purity of the gold jewelers that is being pledged. Gold ornaments Carat-age should be in the range of 18 to 24 Carats. Both hallmarked jewelry and non-hallmarked jewelry can be used for availing jewelry loan.
  • Gold loan rate per gram: HDFC Bank will value the jewelry based on price of 22 carat gold adjusted for purity. HDFC Bank use thirty days average rates of 22 carat gold prices. You can also check today gold rate at MyLoanCare
  • Form of gold pledged: You can get loan from HDFC Bank against jewellery or ornaments with a purity of 18 carats or more and specially minted gold coins with a weight of up to 50 grams. You will not be eligible for loan against gold bars, ETFs (exchange traded funds), specially minted coins of more than 50 grams and ladies mangal sutra.
  • Purpose for which loan is used: You can use the loan from HDFC Bank for personal, business and agricultural purposes. However, HDFC Bank does not allow to use gold loan for speculative purposes such as purchase of gold coins, jewels, land, and investment in stocks, futures and options.

HDFC gold loan per gram for 18 carat, 20 carat and 22 carat jewelry

The following table gives an approximate estimate of gold loan per gram HDFC Bank will offer against gold jewelry of different purity levels at a maximum LTV of 75% and lower LTV of 65%.

Gold Purity Gold rate per gram- average of past 30 days HDFC Bank best Gold Loan per gram HDFC Bank lowest Gold Loan per gram
22 carat 28,320 2,124 1,841
20 carat 25,745 1,931 1,673
18 carat 23,171 1,738 1,506

The above table shows the method by which HDFC Bank will calculate your per gram gold loan for gold of varying purity.

  • Gold loan per gram in HDFC Bank offer for 22 carat jewelry will be between Rs. 1,841 to Rs. 2,124
  • HDFC Bank gold loan per gram offer for 20 carat jewelry will be between Rs. 1,673 to Rs. 1,931
  • Gold loan per gram offer of HDFC Bank for 18 carat jewelry will be between Rs. 1,506 to Rs. 1,738

Gold Loan Schemes of HDFC

HDFC Bank offers several gold loan products to meet your various product requirements. These include loans with different repayment options

  • Gold Loan with EMI option

    This scheme offers the option of paying gold loans in the form of EMIs. Each month you pay an EMI to the bank, which contains a component of interest as well as principal repaid. The component of interest is higher in the initial EMIs and reduces with each EMI.

    • Offered for loans with a tenure of more than 6 months
    • Offered only in case of preapproved offers of gold loans for existing bank account customers
    • Offered on floating rate of interest
    • Maximum LTV of 75 percent allowed
  • Gold Loan with Bullet repayment option

    It offers a bullet repayment option in which customers can pay the entire principal amount of the loan at the end of the tenure.

    • This repayment option is more prevalent for short tenure gold loans (less than 6 months)
    • This is a fixed rate loan scheme
    • Interest is charged monthly and can be paid with principal at the date of maturity. Bank may also ask you to pay EMI for monthly interest
    • No lock in period. However, bank charges a penalty of 1 percent for preclosure before 6 months.
    • Upfront deduction of six months interest is charged if a customer does not have a HDFC account or if the loan amount is less than Rs 50,000
    • Lower LTV of 65 percent compared to EMI option
  • Gold Loan with Overdraft facility

    Overdraft facility is a facility given against gold to allow the borrowers in which borrower is allowed to withdraw funds or deposit surplus amount in the account during the loan tenure. The borrower is required to pay an interest only on credit utilised. This loan is especially useful for self employed borrowers or salaried borrowers who earn annual bonuses.

    • Rate of interest are floating and interest to be paid over the utilized amount.
    • No lock in period and no prepayment penalty charged
    • Comes with an option of renewing the OD by paying the applicable processing fees

HDFC Loan Calculator

Eligibility or gold loan per gram is completely dependent on the assessment of weight and purity of the gold jewelry that is being pledged. Once you approach a bank or a gold loan company, it will conduct a valuation of your gold jewelry and then apply a LTV of up to 75% of the calculated value of the jewelry to be pledged to arrive at the eligibility. The value of gold jewelry and the eligibility is calculated based the following steps:

Step 1: The bank or financial institution will test the level of gold purity and adjust the price of pledged gold in proportion of its purity.

Purity of gold is defined in carat, which means parts of gold. A 100 % pure gold is defined as 24 carat gold. So, 18 carat gold would mean an 18 carat of gold mixed with 6 carat of other metals.

The bank or gold company will adjust the value (price of gold) of jewellery for its purity. The price of 22 carat gold of last 30 days will be adjusted proportionately for the purity of gold pledged. For instance, the value/price of a 18 carat gold will be calculated by multiplying the average price of 22 carat gold for the last 30 days by multiplying it by 18/22.

Banks use 30 days average rates of 22 carat gold prices as directed by RBI. The rates used are as published daily by Bombay bullion's association.

Step2: Weight of gold jewellery is netted off for weight of stones and gems

The bank will measure the net weight of your gold jewellery by deducting the weight of the stones and gems that have been used in the gold jewellery. So, if you intend to use your diamond jewellery for pawn, the bank will deduct the weight of diamond from the total weight of the jewelry to calculate the net weight of gold in your jewelry.

Step 3: Bank will calculate the value of the jewellery as eligible for loan and apply a LTV to arrive at your gold loan amount eligibility

The bank will calculate the value of the jewellery to be pledged by multiplying the net weight of your gold jewellery as calculated in Step 2 above with the adjusted price of gold as calculated in Step 1 above.
The bank will then apply a LTV to the calculated value of jewelry to calculate your eligibility.
Banks are allowed to lend at a maximum LTV of 75%. However there are multiple schemes with LTVs between 60 - 75% on offer by leading loan providers. Higher the LTV, higher the interest rate charged.

HDFC Gold Loan EMI Calculator

Gold Loan EMI of HDFC Bank is a fixed amount that you pay each month towards the repayment of your jewel loan. Lowest EMI offered by HDFC Bank is Rs. 4,661 per lakh loan amount at lowest gold loan interest rate of 11.00%. Gold loan EMI of HDFC Bank depends upon:

  • Rate of interest: Higher the interest rate, higher will be the EMI. For a 24 months gold loan from HDFC Bank at interest rate of 11.00% per annum, EMI will be Rs. 4,661 per Rs. one lakh loan amount. At interest rate of 14.50% for the same loan, the EMI will be Rs. 4,825
  • Loan tenure: Longer the loan tenure, lesser your monthly EMI. At 11.00% per annum, the EMI would range from Rs. 17,205 to Rs. 4,661 for loan tenure ranging from 6 months to 24 months

Use EMI Calculator to calculate your interest on gold loan at different tenure

Gold Loan EMI for Rs. 1 Lakh loan amount at lowest 11.00% interest rate offered by HDFC Bank for different tenures
6 months 12 months24 months
HDFC Bank EMI for a loan amount Rs. 1 lakh at 11.00% 17,205 8,838 4,661
Total amount you pay back to the bank including principal and interest 103,230 106,056 111,864
Interest you have to pay over loan tenure 3,230 6,056 11,864

As you can see in the above table that longer the loan tenure, lower is the EMI you pay on gold loan. However, your total interest outgo is significantly higher in case of long tenure loan. In the above example, if you take a Rs. 1,00,000 loan for a period of 24 months, the lowest EMI you will pay of Rs. 4,661. However, you pay an interest of Rs. 11,864 on a Rs. 1,00,000 loan.

In comparison, if you take a Rs. 1,00,000 loan from HDFC Bank at the lowest interest rate for a period of 6 months, your monthly EMI will be as high as Rs. 17,205 and pay an interest of only Rs. 3,230 which is less than what you paid in a 24 months loan. Hence, you must choose your loan tenure wisely as longer tenure leads to high interest cost.

Documents Required for HDFC Gold Loan

The documentation process of HDFC Bank is smooth. You need to submit one proof of identity and one proof of address to get a gold loan. The list of identity and address proofs are as follows:

  • Identity proof: PAN Card, Driving License, Passport, Voter’s ID Card, Aadhar Card
  • Address proof: Voter’s ID Card, Aadhar Card, Rent Agreement, Utility Bills, Bank Statement

Compare Gold Loan Interest Rates of HDFC with other banks

Frequently Asked Questions on HDFC Bank Gold Loan

How much interest is charged by HDFC Bank on gold loan?

HDFC Bank gold loan interest rates today are 11.00% to 14.50%.

What is the lowest EMI per lakh on HDFC gold loan?

If you apply for loan against gold from HDFC Bank, your lowest EMI per lakh will be Rs. 4,661.

What is the minimum and maximum tenure of HDFC Bank jewel loan?

You can repay your jewel loan from HDFC in a flexible period of minimum 6 months to maximum 24 months.

How much gold loan amount I can borrow from HDFC Bank?

HDFC Bank offers you loan against gold if you need a minimum amount of Rs. 25,000 to a maximum amount of Rs. 5,000,000.

How much processing fee is charged by HDFC Bank on jewel loan?

HDFC Bank charges a processing fee on gold loan- 0.50% to 1.00%

Are there any prepayment charges on gold loan?

Yes, you can prepay your jewel loan. Applicable prepayment charges - Option from Nil to upto 1%.

If I fail to repay the loan amount on time, what are the late payment charges on HDFC Bank gold loan?

If you fail to repay the loan amount on due date, then you need to pay penal charges at 2.00% per month over and above contract rate of interest. In case the loan is still not paid back, HDFC Bank may dispose off the gold and recover its dues including principal, interest and penal charges.

Is gold loan HDFC Bank available online? Is there a HDFC Bank gold loan online payment facility?

Yes, you can avail gold loan online in HDFC Bank. Yes, the bank offers HDFC Bank gold loan online payment facility.

Hdfc Bank Gold Loan

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