In Indian households, gold has a lot of capital appreciation. It is considered auspicious and has a lot of cultural value attached to it. This makes us the biggest importers of Gold in the world. In an interview with India's financial daily, The Financial Express, the managing director of the World Gold Council had revealed that Indian households had accumulated around 25,000 tonnes of gold.
Do you know, you can use gold for meeting your understanding of the cash crisis too. The skyrocketing prices of Gold make it the most profitable way to get credit for financial requirements. You can use the accumulated gold to avail the required gold amount. All you have to do is to submit the gold articles against the required amount in the banks or NBFCs. The banks will then provide the loan amount according to their policies and gold loan per gram scheme.
Benefits of a gold loan
Faster Processing - The gold loans have relatively faster processing than most other loans. The banks are happier to accept physical gold as security because they can sell off that gold in case the borrower fails to pay the loan on time.
Credit history doesn't matter - The best thing about gold loans is that the creditor's history doesn't matter. In the case of other loans, the credit history and the repayment capability is given the priority.
Apply with just KYC documents - Unlike other loans, gold loans are extremely easy and convenient to apply. You don't need a list of documents. They need your ID proof, address proof and KYC documents. Once the document verification is done, the loan gets processed.
No need of income-proof - Generally, the banks don't ask for your income proof. This is because gold submitted is substantial security against the loan amount given.
Option to pay only interest - Gold loans come with a striking feature where the borrower has the option just paying the gold loan interest rate only, and the principal amount can be paid later at the time of closing the account.
Low or no prepayment charge - Many Banks and NBFCs either charge a low prepayment penalty of 1% or no foreclosure charges during the sanctioning of loans.
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