Gold Loan Interest Rates In India 2023

In India, gold isn't just a metal; it's so much more. It has decorative value and is a popular investment and savings option for many people. Apart from purchasing gold for investment or savings, many people choose gold loans, a type of credit that is fast gaining popularity.

In a country like India, where gold is prized, a gold loan is simple to secure. Anyone with idle gold in the form of jewelry can pledge it to receive financial assistance. This form of loan is advantageous since it allows people to obtain funds without having to sell long-term investments.

Gold loan interest rates in India

A gold loan is one that is secured by giving gold as collateral. It is a secured loan in which the lending bank/NBFC takes gold items as collateral, such as gold jewelry, ornaments, and so on. The borrower is issued a loan with this gold as security.

As is the case with most loans, the bank's interest rate is proportionate to the amount of the loan. As a result, be prepared to pay a higher interest rate if you want a large loan. The quantity and character of the gold papers determine the maximum gold loan amount. The objects are also examined by a bank-appointed appraiser for uniformity and quantity.

However, since this is a secured loan, the rate of interest is lower than it is for unsecured loans such as personal loans.

The interest rate provided to applicants is influenced by the MCLR (Marginal Cost of Fund Based Lending Rate) or RRLLR (Repo Rate Linked Lending Rate). Banks that offer gold loans secured by the RRLLR are significantly quicker to notify borrowers when the RBI lowers the repo rate.

Comparison of gold loan interest rates 2023

Name of the bank/NBFC

Rate of interest (p.a)

Processing fee

Loan amount (in Rs.)


7% onwards

0.5% + GST

20,000 to 50 lakh



1% of disbursal amount

10,000 onwards

Canara Bank


Rs. 500-Rs. 5000

5,000 to 35 lakh

Axis Bank


0.5% + GST

25,000 to 25 lakh

Kotak Mahindra Bank


Up to 2% + GST

20,000 to 1.5 crore



1% of loan amount

50,000 to 10 lakh

IndusInd Bank


1% of loan amount

Up to 10 lakh

Punjab National Bank


.75% of loan amount

25,000 to 10 lakh

Bank of Maharashtra


Rs. 500-Rs. 2000 + GST 

Up to 20 lakh

Bank of Baroda


Applicable charges + GST

Up to 25 lakh

Federal Bank


Applicable charges + GST

Up to 75 lakh

Muthoot Gold Loan


Applicable charges + GST

15,000 onwards

Charges associated with a gold loan

The borrower is frequently forced to pay processing charges/fees to get loans such as home, auto, and personal loans.

Apart from processing fees, an applicant for a gold loan may be required to pay for the valuation of gold that will be used as collateral by the lending institution. For example, HDFC Bank charges Rs 250 for loans up to Rs 1.5 lakh and Rs 500 for loans exceeding Rs 1.5 lakh as valuation costs.

A bank can charge paperwork and foreclosure fees in addition to processing and valuation fees.

As a result, you should confirm all fees and charges with the bank or NBFC before taking out the loan.

Eligibility criteria for a gold loan

The loan per gram of gold or the loan amount, which is calculated by the value of gold pledged (based on gold price), purity of gold, and the LTV applied by banks, determines gold loan eligibility.

The price of gold is computed using the 30-day average price of 22-karat gold and the loan-to-value provided by your bank. The amount of your Gold Loan EMI is decided by your loan eligibility, interest rate, and loan tenure.

Several lenders offer loans based on gold pledges with low-interest rates. The loan amount is determined by the quantity of gold you promise. The loan amount per gram varies depending on the bank.

Additionally, your credit score, age, income, etc. will also play a role in determining your eligibility for a gold loan.

Documents required to get a gold loan

The bank or NBFC will require you to present several documents in order to obtain a gold loan, such as -


There are multiple lenders in the market today offering gold loans. The perfect one to choose will solely depend on your requirements. How much collateral will you be able to provide? What is your repayment capacity? Take a look into these factors before selecting the perfect loan for you. In the meantime, if you are looking for a collateral-free loan that is disbursed instantly and requires minimal documentation, visit the Money View website or download the app to apply!

Best Bank for Gold Loan - Related FAQs

On the gold loan offered by SBI, a margin of 25% is applicable.

This loan scheme provides a minimum loan amount of Rs. 20,000.

Loans are available in the form of either an overdraft or a demand loan.

Yes, a demand loan has a maximum repayment term of 30 months, whereas an overdraft has a maximum repayment term of 36 months.

The repayment process starts immediately, with the borrower expected to pay EMIs once a month after the loan is approved.

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