Want gold loan? Know the interest rate offered by banks and documents required

Gold is a very popular metal which can be found in every house in the country. People tend to buy gold ornaments for the purpose of marriage or for gifting or for many other reasons.

Now, gold has also become one of the most popular forms of getting loan. You can get a loan against the gold you have in case of emergencies or for the fulfillment of financial goals.

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What is a gold loan?

When a borrower takes a loan against gold (within a range of 18-24 carats) from a lender then it is known as a gold loan. However, you need to note that the loan amount provided is a certain percentage of the gold which is based on the current market value and quality of the yellow metal.

Generally, most of the banks provide gold loans for a maximum loan to value ratio of 75 percent of the current market price of the gold.

What are the benefits of taking gold loan?

If you want to avail gold loan then the benefits which you can get include lower interest rates, quick and hassle-free loan disbursal, flexibility of use, among others.

Documents required:

People can know that the documents required to avail gold loans vary from lender to lender. Some of the common documents required include identity proof of the borrower like the Aadhaar Card, PAN, Voter ID, etc., photographs, address proof, among others.

Gold loan interest rate:

Different banks charge different interest rates on gold loans. Check the list below to know the current rate offered by some of the banks in the country:

1. State Bank of India: 7.50 percent

2. Bank of India: 7.35 percent

3. Punjab National Bank: 8.75 percent

4. Union Bank: 8.20 percent

5. Axis Bank: 12.50 percent