A gold loan is secured loan availed against the mortgage of gold for a flexible tenure of 1 day to 36 months. To get the best gold rates, the borrower must compare the gold loan interest rate of different banks and financial institutions along with the processing fees charged on the gold loans. Here are top banks that provide gold loans at lowest interest rates.
| Banks | Interest Rate | Processing Fees | Tenure |
| SBI | 7.50% | 0.50% of the loan amount, minimum Rs. 500 | 3 months to 36 months |
| Canara Bank | 7.65% | 1% of the loan amount, Min Rs. 1,000 and Max Rs. 5,000 | 12 months |
| Federal Bank | 8.50% | Nil | 6 months to 12 months |
| PNB | 8.75% | 0.70% of loan amount + taxes | 1 month to 12 months |
| IIFL | 9.24% | Nil | 3 months to 11 months |
While, most of the borrowers prefer gold loans based on the lowest gold rates. There are some borrowers who may also avail gold loan based on gold loan amount.
Gold loan based on the higher gold loan amount: As per recent guidelines from Reserve Bank of India, banks and non-banking financial institutions can provide gold loans up to 90 % of the value of the gold. Earlier, the LTV on a gold loan was 75%.
These are some of the banks that provide the highest gold loan amount.
| Bank | Loan Amount |
| Andhra Bank | ₹ 2,00,00,000 |
| Manappuram | ₹ 1,00,00,000 |
| Federal Bank | ₹ 75,00,000 |
| Yes Bank | ₹ 50,00,000 |
| HDFC Bank | ₹ 50,00,000 |
Popular Banks based on Repayment Methods: A gold loan is also one of the preferred options to get finance for emergencies because of the flexible repayment methods. You can avail gold loan repayment methods as per your requirements.
These are some of the gold loan schemes based on repayment methods:
- Bullet Repayment Method: Under this scheme, you can repay the entire gold loan amount at the end of the tenure instead of paying monthly installments. However, you can also choose to repay the interest component of the gold loan as EMI and the principal component can be paid at the end of maturity period. This gold loan scheme is popular for short term gold loan tenure.
Popular banks with bullet repayment scheme
| Bank Name | Gold Loan Interest Rate |
| SBI | 7.50% – 7.50% |
| Federal Bank | 8.50% – 11.95% |
| PNB | 8.75% – 8.75% |
| HDFC Bank | 9.90% – 17.90% |
- Regular EMI Options: Like every other loan product, a gold loan can also be availed with regular EMI options. Under this scheme, you have to pay both the interest component and principal component as part of a monthly instalment. You can choose regular EMI options for a long-term tenure of the gold loan.
| Bank Name | Gold Loan Interest Rate | Processing Fee |
| PNB | 8.75% – 8.75% | 0.70% of loan amount + taxes |
| IIFL | 9.24% – 24.00% | Nil |
| ICICI Bank | 10.00% – 19.76% | 1% of the loan amount |
| Yes Bank | 11.25% – 16.25% | 0.75%, Minimum Rs. 500 |
| Muthoot | 11.99% – 11.99% | 0.25% to 1% of loan amount. |
- Overdraft Scheme: The overdraft scheme against gold loan allows you to borrow money based on a predetermined credit limit. You can flexibly repay the loan according to your requirements and also the interest is paid only on the utilised amount of gold loan. Also, you can renew the limit at the end of the tenure by paying specified processing fees.
| Bank Name | Interest Rate | Processing Fee |
| Federal Bank | 8.50% – 11.95% | Nil |
| PNB | 8.75% – 8.75% | 0.70% of loan amount + taxes |
| HDFC Bank | 9.90% – 17.90% | 1.50% of the loan amount |
| Yes Bank | 11.25% – 16.25% | 0.75%, Minimum Rs. 500 |
Conclusion: Thus, a gold loan is one of the most preferred options to get finance in case of a financial emergency. Moreover, you can flexibly choose the tenure and repayment tenure as per your requirements to fulfil your financial needs.