The lender then gets the gold verified either through an external party or in-house. After carefully verifying the quantity and quality of gold, the amount assigned is around 80% of the actual value of the gold.
One of the biggest advantages of a gold loan lies here only. A gold loan is a completely secured loan, so in case the borrower will be unable to pay his debt, the lender can sell the gold so pledged in the open market. In this way, lenders are more secured and can recover the amount of their loss in case of default by the borrower.
Gold loan is very easily available nowadays with very little documentation required.
A few of those documents which are required for availing a gold loan are-
Identity proof such as Aadhar Card/ Voters ID, Pan Card, Driving license.
Proof of residence such as Utility bills of the house, Adhaar Card, Pan Card/ Voters ID.
Along with less documentation involved there are many more advantages of a gold loan. The eligibility criteria of a gold loan are quite simplified.
Anyone who wants to avail of a gold loan has to fulfill the below-written Gold Loan Eligibility criteria-
A gold loan is made available only to the residents of India.
To avail of a gold loan the age of the person has to be 18 years or above.
There has to be a self-owned resident in the name of the individual who wants to get the gold loan.
Gold loan is available only on the gold of 18 to 22 carats.
These conditions have been quite simplified in recent times to promote more and more people to avail of a gold loan. Banks do provide maximum support to their customers in case of any issues.
Many financial institutions and banks are offering gold loans. The gold loan has become a significant financial service that it constitutes as a part of the portfolio of all the major banks and financial institutions.
Various banks offering the bank loan and the interest rate charged by them are given as under-
Axis Bank Gold loan (10.90%)
Axis bank is known for the fast processing of loans to make disbursement faster in the account of the customers.
2. HDFC Bank Gold loan (9.99%)
HDFC bank is a very well reputed name in the industry and is known for providing the best after-sales service in the market.
3. Bank of Baroda gold loan (7.70%)
Bank of Baroda recently has a huge collaboration with other banks. It offers a diversified portfolio at a minimal rate of interest. Bank of Baroda Gold Loan is one of the easiest ways to get yourself financed.
4. SBI Gold loan ( 7.50%)
The biggest bank in the nation. Provides excellent services and has a diversified portfolio of services.
Another advantage of a gold loan is that anyone can avail of it. Be it businessman, student, job maker, housewife, anyone can apply for a gold loan. Another good news for the low CIBIL score is that banks are not concerned about your CIBIL score. As a gold loan is a secured loan, the CIBIL score does not matter for the banks.
Within minutes, the loan gets sanctioned and within hours it gets deposited in the bank account of the customer.
Other than these many other banks are offering their services in the gold loan segment.
A huge competition has created clutter in the gold loan market. Many companies are offering their excellent services to attract more and more customers.
Conclusion
The gold loan has many advantages. A sensible and smart customer should always analyze every company offering such products and the returns that can be expected from that. A gold loan is a very secure way of getting finance but a careful analysis before applying will be advantageous for the customers.
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