Gold has always been considered one of the most valuable assets in Indian households. Traditionally, it was seen as a symbol of wealth and security. Today, gold also plays a crucial role in providing financial support during emergencies. When faced with urgent cash needs, many people turn to gold loans as they offer quick disbursal, low-interest rates, and minimal documentation.
In 2025, both banks and NBFCs in India are offering attractive gold loan schemes. In this article, we’ll discuss how gold loans work, their benefits, eligibility, best banks/NBFCs, and step-by-step process to get instant money against your gold.
What is a Gold Loan?
A gold loan is a secured loan where you pledge your gold ornaments or coins as collateral to a bank or NBFC (Non-Banking Financial Company) in exchange for cash. The lender evaluates the purity and weight of the gold and provides a loan amount based on its value.
- Loan amount: Usually 60% – 75% of the gold’s market value
- Tenure: 3 months to 36 months
- Interest rate: Starting as low as 7% p.a.
Once you repay the loan with interest, your gold is returned safely.
Why Choose a Gold Loan?
✅ Benefits:
- Instant cash disbursal – Loan within minutes to hours
- Lower interest rates compared to personal loans
- No income proof required – Only KYC documents needed
- Flexible repayment – EMI, bullet repayment, or overdraft facility
- Safe storage – Gold is stored securely by the bank/NBFC
❌ Drawbacks:
- Risk of losing gold if loan is not repaid
- Shorter repayment period compared to other loans
- Only works if you already own gold
Top Banks Offering Gold Loans in India 2025
1. HDFC Bank Gold Loan
- Interest Rate: 7.5% – 16% p.a.
- Loan Amount: ₹25,000 – ₹50 Lakhs
- Tenure: 3 – 24 months
- Processing Fee: 1% of loan amount
- Key Features:
- Quick disbursal within 30 minutes
- High loan-to-value ratio
- Part payment and foreclosure options available
2. ICICI Bank Gold Loan
- Interest Rate: 7% – 15% p.a.
- Loan Amount: ₹10,000 – ₹1 Crore
- Tenure: 3 – 12 months (renewable)
- Processing Fee: 0.25% – 1%
- Key Features:
- Minimal documentation
- Flexible repayment modes
- Available at all ICICI branches
3. Axis Bank Gold Loan
- Interest Rate: 7.5% – 17% p.a.
- Loan Amount: ₹25,000 – ₹25 Lakhs
- Tenure: 6 – 24 months
- Processing Fee: 1%
- Key Features:
- Quick loan against hallmarked gold
- Safe storage facilities
- Competitive interest rates
4. Kotak Mahindra Bank Gold Loan
- Interest Rate: 7.5% onwards
- Loan Amount: ₹20,000 – ₹50 Lakhs
- Tenure: 6 – 36 months
- Processing Fee: 1%
- Key Features:
- Overdraft facility available
- Flexible repayment schedules
- Minimal documents required
Top NBFCs Offering Gold Loans in 2025
1. Muthoot Finance
- Interest Rate: 8% – 26% p.a.
- Loan Amount: ₹1,000 – ₹1 Crore
- Tenure: Up to 36 months
- Key Features:
- Largest gold loan provider in India
- Instant loan approval within minutes
- 24×7 gold loan ATM in selected cities
2. Manappuram Finance
- Interest Rate: 7.5% – 26% p.a.
- Loan Amount: ₹1,000 – ₹25 Lakhs
- Tenure: 3 – 24 months
- Key Features:
- Loans available for farmers at special rates
- Online gold loan facility
- Transparent valuation
3. IIFL Finance
- Interest Rate: 8% – 24% p.a.
- Loan Amount: ₹3,000 – ₹50 Lakhs
- Tenure: Up to 24 months
- Key Features:
- Doorstep gold loan facility
- 100% digital process
- Competitive LTV ratio
Eligibility Criteria for Gold Loan
- Age: 18 – 70 years
- Ownership: Applicant must own the gold being pledged
- Gold Purity: Usually 18K – 24K accepted
- Documents Required:
- Aadhaar card / PAN card
- Passport-size photo
- Proof of residence
Step-by-Step Process to Get a Gold Loan
- Visit the bank/NBFC branch or apply online (if available).
- Gold evaluation is done to check purity and weight.
- Loan amount calculation based on current gold price and LTV ratio.
- KYC verification with Aadhaar/PAN card.
- Loan sanction & disbursal – Cash or direct transfer to bank account.
- Gold storage – Gold kept securely in bank vaults until repayment.
Repayment Options for Gold Loan
- Regular EMIs – Pay monthly installments
- Bullet Repayment – Pay principal + interest at the end of tenure
- Overdraft Facility – Withdraw money as per need and pay interest only on used amount
Tips to Get the Best Gold Loan Deal
- Compare interest rates between banks & NBFCs
- Check processing fees and hidden charges
- Choose hallmarked gold for better valuation
- Repay on time to avoid losing gold
- Use online EMI calculators to plan repayment
FAQs
1. How much loan can I get against 100 grams of gold?
👉 It depends on purity and market price, but usually ₹4 Lakhs – ₹5 Lakhs for 22K gold.
2. Is my gold safe with banks and NBFCs?
👉 Yes, gold is stored in secure vaults with insurance.
3. Can I get a gold loan without income proof?
👉 Yes, only KYC documents are required.
4. Which is better: gold loan from bank or NBFC?
👉 Banks usually offer lower interest rates, while NBFCs provide faster processing and flexible options.
5. Can I prepay or foreclose a gold loan?
👉 Yes, most lenders allow foreclosure with minimal or no charges.
Conclusion
A gold loan is one of the fastest and easiest ways to get instant money during financial emergencies in India. With attractive interest rates and minimal paperwork, it is a better choice compared to high-interest personal loans.
In 2025, leading banks like HDFC, ICICI, Axis, and Kotak Mahindra, along with NBFCs like Muthoot Finance, Manappuram, and IIFL Finance, are offering excellent gold loan services.
If you have idle gold at home, pledging it for a loan can be a smart financial decision—just make sure to borrow only what you can repay on time.
