Silver Assay vs Hallmarking: What the Difference Means for Your Silver Loan

Two terms are often used together when discussing silver purity, but they refer to different parts of the same process. A silver assay is the testing process used to determine how much pure silver an article contains. Silver hallmarking is the certification system through which a purity grade is officially marked on the article after testing under the applicable BIS framework. For silver loan, purity evaluation is an important aspect of collateral valuation and hallmarking may help to verify the purity grade of an eligible silver article. Hallmarked silver items have some identifiers such as fineness grade and HUID code which can be independently verified. 

Silver hallmarking, silver assay and purity verification give borrowers a better insight into how eligible silver collateral may be valued during the valuation process.

Assay vs Hallmark: Two Steps in the Same Process

The silver assay comes first. It is the testing process used to determine the silver content of an article, expressed as fineness or parts per thousand. Silver hallmarking follows the successful completion of the prescribed testing and certification procedures under the BIS hallmarking framework.

Note: All figures are indicative only. Eligibility, valuations, documentation, fees and collateral evaluation are subject to lender policies, borrower profile, product type and applicable regulations.

A hallmark is to be distinguished from a mark applied by a seller. Under the BIS framework, jewellers register with BIS and send articles to recognised Assaying and Hallmarking Centres for certification. A hallmark is only applied through the recognised certification process.

BIS Silver Purity Grades: What the Numbers on Silver Mean

BIS certifies silver against the applicable Indian Standard for silver hallmarking. Fineness grades indicate the proportion of pure silver within an article.

Note: Actual collateral eligibility depends on lender policies, collateral assessment, and applicable regulations.

Both 999 silver and 925 silver are recognised silver grades. The difference lies in the proportion of pure silver present within the article. Because collateral valuation generally considers net silver content, a higher-fineness article contains a larger proportion of silver per gram. For silver loan assessments, ornaments are commonly assessed from around 800 fineness up to 925 sterling, subject to lender policies and collateral evaluation, while bank-sold coins may be required to meet separate eligibility conditions.

Is 925 Silver Real Silver?

Yes. 925 Silver is just a fancy way of saying sterling silver, which is made of 92.5 percent pure silver, with 7.5 percent alloying metals added to strengthen it. 925 is a standard purity grade under the BIS hallmarking system and is commonly used in jewellery making.

For silver loan purposes, the presence of a 925 purity grade does not itself determine eligibility or valuation. Assessment outcomes remain subject to collateral evaluation and lender policies.

Is Pure Silver 999 or 925?

999 silver represents 99.9% purity and is commonly referred to as fine silver. 925 silver represents sterling silver with 92.5% purity.

Both are legitimate purity grades under the BIS hallmarking standard. The difference is the proportion of silver contained in the article rather than the validity of the grade itself.

How Silver Hallmarking Affects a Silver Loan

A silver hallmark may assist the collateral-assessment process by providing a documented purity indication that can be independently verified. However, lenders may still conduct their own testing and valuation procedures in accordance with applicable regulations and internal policies. Both hallmarked and non-hallmarked silver may be subject to assessment before a valuation outcome is determined.

The valuation process may involve:

1. Determining purity and net silver content.
2. Excluding non-silver components where applicable.
3. Applying the prescribed benchmark valuation methodology.
4. Applying the relevant LTV limits based on loan size.

The applicable regulatory framework prescribes maximum LTV ceilings of:

• Up to 85% for loans up to ₹2.5 lakh
• Up to 80% for loans above ₹2.5 lakh and up to ₹5 lakh
• Up to 75% for loans above ₹5 lakh

These limits are determined by the applicable framework and loan amount rather than by hallmark grade alone.

Illustrative Example

For illustration only:

• 100 grams of 999 silver contains approximately 99.9 grams of silver.
• 100 grams of 925 silver contains approximately 92.5 grams of silver.

At the same benchmark valuation price, the article containing more silver would generally have a higher net silver content. Actual valuation outcomes depend on applicable benchmark prices, collateral assessment, purity determination, lender policies, and regulatory requirements.

HUID for Silver: How to Verify a Hallmark

From 1 September 2025, hallmarked silver articles are required to carry a Hallmarking Unique Identification (HUID) code where hallmarking has been carried out. HUID-based silver hallmarking was introduced to improve traceability and consumer verification. Silver hallmarking remains voluntary, but where a silver article is hallmarked, the HUID requirement applies.

The current BIS hallmark structure consists of:

• BIS Standard Mark with the word "SILVER"
• Purity Grade
• HUID Code

HUID Verification Process

1. Download the BIS Care App.
2. Select the HUID verification option.
3. Enter the HUID code appearing on the article.
4. Review the information returned, where available.

The BIS verification process may provide information relating to purity grade, article details, hallmarking information, and associated records maintained within the system.

Where verification results are unavailable or inconsistent, additional verification through appropriate authorised channels may be considered.

Can Silver Be Hallmarked at Home or by a Jeweller in India?

No. Under the BIS hallmarking framework, silver hallmarking can only be carried out by BIS-recognised Assaying and Hallmarking Centres following the prescribed testing and certification process. Jewellers register with BIS and submit articles for certification through recognised centres.

The process is a standard industry process and forms part of the regulated hallmarking framework applicable to silver articles.

How IIFL Finance Assesses Silver, Hallmarked or Not

Subject to product availability, borrower eligibility, collateral assessment, and applicable regulations, IIFL Finance may offer silver loan products against eligible collateral.

Where such products are available, collateral assessment, valuation methodology, purity verification, disclosures, and documentation requirements are governed by applicable regulations and internal policies.

The assessment process may include:

• Purity verification
• Weight measurement
• Net silver-content determination
• Valuation using the prescribed benchmark methodology
• Issuance of applicable valuation and assessment records

Hallmarked and non-hallmarked silver may both be assessed, subject to collateral eligibility requirements and lender policies. Eligibility outcomes, valuation results, documentation requirements, charges, and loan amounts vary according to collateral assessment, borrower profile, lender policies, and applicable regulations.

The final terms remain governed by the applicable loan agreement and related documentation.

Conclusion

Silver assay and silver hallmarking serve different functions within the purity-verification process. A silver assay determines purity through testing, while silver hallmarking records a recognised purity grade within the BIS certification framework where applicable.

For silver loan assessments, purity forms one component of the valuation process. Eligible collateral is assessed in accordance with applicable regulatory requirements, lender policies, benchmark valuation methods, and collateral-assessment procedures.

Hallmarked and non-hallmarked silver may both be assessed, subject to eligibility requirements. While a hallmark may be used to verify purity, the valuation result is determined by the lender’s valuation process, benchmark prices, purity determination, collateral characteristics, and applicable regulations.

 Valuation procedures, disclosures, eligibility criteria and treatment of collateral are still subject to applicable laws, regulations and lender policies.

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