Gold Loans in Amritsar

Gold Loans in Amritsar

Amritsar, home to the Harmandir Sahib—more commonly known as the Golden Temple—is situated in the state of Punjab, India. The main business and commercial industries are tourism, carpets, fabrics, agriculture and handicrafts.

Amritsar is home to some of the leading banks and other NBFCs in India. Are you looking for a gold loan in Amritsar and wondering what your options are? You have reached the right place. Read on!

What Is a Gold Loan?

Gold loan is a secured loan wherein a customer pledges gold (this includes jewellery, ornaments and bank-issued coins) as collateral for taking a loan, it is known as a gold loan. The bank uses the gold as security against potential payment default by the customer. The borrower gets money to the value of certain percentage of the gold that is pledged.

Gold loans are short-term loans and the repayment period can range from one month to a few years. If an individual needs money for immediate expenses and expect to be able to pay it back in the short term, then this type of loan might be a good option.

Benefits of Gold Loans

A gold loan is the immediate help in times of emergencies as it helps an individual get cash within a day. The loan can be used for following purposes.

• Gold loan can be taken to fund the education of children.
• It can be useful for expanding business or working capital requirement.
• To improve the agriculture by buying machineries for irrigation and other needs
• When a medical emergency strikes, a gold loan can be a saviour.
• To get urgent fund while going on a trip
• Gives the sense of using an own asset to finance your needs

Features of Gold Loans in Amritsar

Gold Loans have the following features which will explain why they are more convenient in getting instant cash for short-term needs.

• The tenure in gold loan is up to 5 years depending on the lender.
• Instant approval of the loan by pledging the gold ornaments, jewelleries etc.
• Availability of different schemes depending on the needs of the customers
• Pre-payment penalty varies from lender to lender
• Better rate of interest when compared to most of the other loans
• As it is a secured loan, good credit score is not a requirement for availing it.
• Quick disbursement of the loan mostly on the same day
• No charges on foreclosure

How to Choose a Gold Loan in Amritsar?

Gold loans are easy means of getting money during an emergency. While choosing the gold loan, it is important to check some of the factors that determine the loan. Banks and NBFCs do not give the entire value of the gold as loan. As per the RBI guidelines, the Loan To Value (LTV) is up to 75% for gold loans.

As gold loans are short-term loans, borrowing should be done base on the need and repayment capability. The lenders will auction the gold if the customer fails to repay the loan amount.

Checking the interest rate is important while choosing the best gold loan. Public sectors bank charge less interest when compared to NBFCs. Also, the repayment structure is different in both the financial institutions. The documentation process is lesser with NBFCs while the banks may have strict paperwork. The disbursal of the loan is much faster with NBFCs and no prepayment charges are levied unlike banks.

Choosing the gold loan depends on the loan amount and circumstances. For faster loan disbursal is a good choice while for getting low interest rate on the loan, a bank is a good option.

Eligibility Criteria to Avail Gold Loans in Amritsar

Following are the eligibility criteria that a borrower needs to fulfil before applying for a Gold loans

• The borrower must be above 18 years of age and up to 75. The age limit may vary depending on the lender.
• Self-employed, salaried employees and non-professionals, and must have gold

Documents Required to Get Gold Loans in Amritsar

Though the paperwork is minimum, the banks generally demand the following documents while applying for a gold loan. Following are some of the documents that are necessary to avail the gold loan.

• Signed Application Form
• ID Proof (photo copies of Voters ID card/ Passport/ Driving licence/ IT PAN card)
• Address Proof (photo copies of recent Telephone Bills/ Electricity Bill)
• Signature Proof
• Pan Card/Form 60
• Age Proof

Fees and Interest Charges on Gold Loans in Amritsar

Following are the fees and charges generally applicable to get a gold loan Amritsar. The rates may vary from lender to lender.

• The interest rate may go up to 17% for banks and up to 26% for NBFCs.
• The processing fee may be up to 2% depending on the lender.
• Most of the banks do not charge on foreclosure of the loan.
• Penal interest is levied on overdue amount.

Gold Loans for Defaulters in Amritsar

Defaulters who have not paid their previous loans or credit card bills can get Gold loans without much difficulty in Amritsar. As a gold loan is a secured loan, even if the defaulter again defaults, the collateral will be auctioned by the lender and the amount will be taken by them.

Though it is easy for defaulters to get a gold loan, it is highly important to repay it consistently. This can improve the credit score and credit eligibility.

How to Apply for Gold Loans in Amritsar?

Individuals who need gold loans can apply by visiting any nearby bank or NBFC with the gold. After filling up the application form, the gold will be evaluated by the bank’s representative. Following it, the loan will be disbursed in an hour. Some lenders do offer door-step services to their customers.

The customers can also apply through CreditMantri to get the best gold loan. CreditMantri matches the borrower’s credit and demographic profile to the lender's lending criteria and presents a shortlist of only those lenders willing to lend based the credit profile. The customers can choose the best lender who offer better interest rate and services by applying through CreditMantri.

Which Is the Best Gold Loan Lender in Amritsar?

As per the new RBI rule, the LTV for gold loans has been raised from 60% to 75%. Amritsar is home to the leading banks and NBFCs which provide Gold loans.

The customers can choose the best lender who offers better interest rate, suitable repayment options and customer services. For speedy disbursal of the gold loan, an NBFC is recommended, but the interest rate is higher than the banks.

Gold Loan Interest Rates in Amritsar

The below table shows the interest rate range of some of the popular lenders in Amritsar.

The interest rate given above are subject to change depending on the market situations at the sole discretion of the lender.

Amritsar Gold Loan FAQs