Consent for Aadhaar Authentication in a ₹7,20,000 Gold Loan

During a loan application, a borrower is often asked to tick a box or sign a form before Aadhaar is checked. Few people stop to read what that consent covers.

This blog explains it for a ₹7,20,000 aadhaar loan taken against gold. Such a loan is secured by pledged ornaments, which are valued under RBI rules. Aadhaar is used at KYC (customer identification), the check a lender runs on identity and address.

The blog sets out what a lender has to tell the holder before Aadhaar authentication, and how far the consent goes. It then covers documents, valuation and the steps for a loan of this size.

Consent Under the Aadhaar Act

Section 8 of the Aadhaar Act requires an entity to take the holder's consent before authentication. The entity is also required to inform the holder about three matters.

The first is the kind of information that will be shared on authentication. The second is the use to which that information will be put. The third is the alternatives to submitting Aadhaar details.

The last point is an important one for borrowers. It means the borrower may generally choose another officially valid document, such as a passport or voter ID, for KYC.

Scope of the Borrower's Consent

Consent for Aadhaar authentication covers the identity check. On its own, it does not cover a credit bureau enquiry, for which a separate consent is generally taken.

A lender may also ask for consent for an Aadhaar-based e-Sign of the loan papers. Each consent is tied to its stated purpose.

The question can I get ₹7,20,000 loan on aadhaar card assumes that a single tick is enough. The truth of the matter is that a loan application of this magnitude can have many consents, each for a particular process.

The bank can take into account the credit history based on its internal guidelines and regulations. In case the amount lent in gold and silver is greater than ₹2.5 lakh, then it becomes essential to conduct an extensive analysis of credit worthiness.

Eligibility and Valuation

Eligibility criteria such as age restrictions and residency requirements are determined by the relevant rules and policies of the lending institution.

These RBI (Lending against Gold and Silver Collateral) Directions, 2025 came into force from April 2026 by regulated institutions. In case of lending over ₹5 lakhs, the LTV ratio or the maximum amount that the financial institution can lend against the value of gold is 75%.

For a ₹7,20,000 aadhar loan, the gold price used is the lower of the previous day's close and the 30-day average. Both of these come from IBJA or SEBI-recognized exchanges. Once it goes through the purity test, non-gold is subtracted, and the net gold is valued based on its purity level.

The gold needed shifts with the price, the purity found and the lender's procedure. Charges can differ from product to product and lender to lender because each one will have its own needs for funding and management.

Documents Required for a Gold Loan of ₹7,20,000

A ₹7,20,000 aadhaar card loan against gold rests on a short list of papers.

1. Aadhaar, used after consent, or another officially valid document such as a passport or voter ID
2. PAN card, generally needed for a loan of this size to meet KYC, tax and regulatory requirements
3. Income papers, such as a bank statement, payslip or tax return
4. Bank account details in the borrower's own name
5. The gold ornaments for testing and valuation

Where its internal procedures require, the lender may seek a declaration or other records about who owns the pledged ornaments. Further papers, if any, would depend on lender policy, the loan amount and the needs of the assessment.

Application Process

A ₹7,20,000 aadhaar loan application against gold generally passes through these stages, with consent taken at more than one point.

1. The applicant approaches a regulated lender at a branch, or through its website or app where available.
2. The lender explains the Aadhaar consent and its alternatives, and KYC is completed with Aadhaar or another document.
3. The ornaments are tested and weighed in the applicant's presence, and the valuation certificate is issued.
4. With separate consent, the lender checks credit records, reviews income and shares the amount, rate, tenure and charges.
5. The applicant signs the agreement, at times through Aadhaar e-Sign, and disbursal follows once verification and the remaining formalities are complete.

Where approved, the loan amount is credited to the bank account the borrower has named, in line with lender procedures. After the last payment, the pledged gold is generally released within seven working days. The directions provide ₹5,000 a day if the lender is responsible for any delay.

IIFL Finance Support for Gold Loan Applicants

IIFL Finance may make a gold loan of ₹7.2 lakh available. This is subject to product availability, the borrower's eligibility, the assessment of the gold and the regulatory requirements of the time. Certain gold loan products may be structured for borrowers with eligible gold who want each step explained before they agree to it.

As long as regulatory requirements and lender policies are met, funds from a gold loan may be applied to various genuine personal or business purposes:

• Fees for a professional certification or degree
• Treatment and a hospital stay for a family member
• Working capital for a handloom or textile unit
• Expenses of a family function or religious ceremony

A pledge is not a sale, so the borrower generally continues to own the gold, subject to repaying the loan as per the lender's terms.

Conclusion

The Aadhaar Act requires a lender to take consent before authentication. The lender is also required to explain what is shared, how it is used and what the alternatives are. That consent covers the identity check, while a credit enquiry or an e-Sign generally has a consent of its own. For a ₹7,20,000 aadhaar loan, these consents run alongside the main checks on the gold and on repayment capacity. The final amount turns on the assessed gold and the 75% LTV cap.

A gold loan may offer access to funds against eligible gold, while ownership of the pledged ornaments stays with the borrower. Valuation, disclosures and the handling of the collateral are dealt with in line with the applicable policies and regulations.

Disclaimer : The information in this blog is for general purposes only and may change without notice. It does not constitute legal, tax, or financial advice. Readers should seek professional guidance and make decisions at their own discretion. IIFL Finance is not liable for any reliance on this content. Read more