A gold loan is a secured loan that uses gold as collateral to get money from a lender. It's a quick way to get cash for immediate or long-term needs.
How does a gold loan work?
You pledge your gold to the lender.
The lender assesses the quality and quantity of your gold.
The lender gives you a loan based on the market value of your gold.
You repay the loan, plus interest, over time.
Once you repay the loan, you get your gold back.
Benefits of a gold loan
A gold loan is a good option if you own gold and need money quickly.
Gold loans are secured loans, so they usually have lower interest rates than unsecured loans.
Things to consider
Before taking out a gold loan, you should consider the repayment terms and conditions.
You should choose a reputable lender with clear terms and conditions.
The loan amount you can get depends on the current market value of your gold.
Who can offer gold loans?
Commercial banks and non-banking financial companies (NBFCs) can offer gold loans.