Silver Loan in Dadra and Nagar Haveli and Daman and Diu: Interest Rate, Eligibility, Documents and How to Apply

A silver loan in Dadra and Nagar Haveli and Daman and Diu is a secured loan where eligible silver ornaments or qualifying bank-sold silver coins are pledged with a regulated lender in exchange for credit, subject to lender assessment and applicable regulatory requirements. Lending against silver is governed by the RBI (Lending Against Gold and Silver Collateral) Directions, 2025, implemented by regulated lenders from April 2026. This guide explains how the product works in the Union Territory, including silver loan interest rate considerations, silver loan eligibility, accepted collateral, silver loan documents, a worked loan illustration, and how to apply for a silver loan.

What Is a Silver Loan and How Does It Work in This UT?

The borrower pledges eligible silver; the lender values it under the regulatory method, and a loan is sanctioned within the applicable LTV ceiling for its size. Ownership of the pledged silver generally remains with the borrower during the loan tenure, subject to repayment obligations, lender policies and applicable terms and conditions. The pledged items remain in the lender's custody until the loan is closed.

Residents of Silvassa, Naroli and Khanvel on the Dadra and Nagar Haveli side, and of Nani Daman, Moti Daman and Diu on the coastal side, may access the product through regulated lenders operating in their area, subject to product availability and lender policies. The regulatory framework applies uniformly across the Union Territory.

Silver Loan Interest Rate in Dadra and Nagar Haveli and Daman and Diu

The RBI framework sets collateral, valuation and LTV requirements but does not prescribe a fixed silver loan interest rate. Interest rates are determined by individual lenders and may vary depending on the loan amount, tenure, repayment structure, internal policies, and applicable market conditions. Interest rates and charges may differ across products and lenders based on operational, funding, and risk-management considerations.

The Key Facts Statement (KFS) issued before loan execution provides a consolidated summary of applicable interest rates, charges, repayment obligations, and other key terms. Borrowers may review the KFS and other lender disclosures when evaluating available loan options.

How Much Loan Can Be Taken on Silver? LTV and a Worked Example

The tiered ceilings apply by loan size:

• 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

Valuation uses the lower of the 30-day average and the previous day's closing price published by IBJA or a SEBI-recognised exchange, counting net silver content only against the 99.9 fine benchmark.

A worked illustration at an illustrative benchmark of ₹247 per gram:

A borrower in Silvassa pledges 500 grams of sterling ornaments. Net of purity conversion, 500 grams at 0.925 gives about 462.5 grams of fine-silver equivalent, producing an assessed value of roughly ₹1.14 lakh. The small-loan ceiling of 85 per cent then supports an eligible amount of approximately ₹97,000, subject to lender assessment.

A 100-gram lot on the same arithmetic supports roughly ₹19,400.

These figures are illustrative only. The benchmark on the valuation date and the lender's purity assessment determine the actual loan amount.

Which Silver Items Are Accepted as Collateral?

Eligible collateral covers:

• Silver ornaments and jewellery, commonly accepted from around 800 fineness up to 925 sterling, subject to lender assessment
• Up to 10 kg of qualifying silver ornaments per borrower
• Bank-sold silver coins of 925 fineness or higher up to 500 grams per borrower

The following are generally not accepted under the framework:

• Silver bullion
• Silver bars and biscuits
• Silver utensils
• Silver-plated articles
• Silver ETFs
• Digital silver

Loans also cannot be granted for the purchase of silver in any form. Hallmarking may support valuation, but the lender's purity assessment conducted in the borrower's presence remains the basis for lending decisions.

Eligibility Criteria for a Silver Loan in Dadra and Nagar Haveli and Daman and Diu

Ownership of eligible silver is a primary condition because the pledged collateral secures the loan. Indian residents aged 18 years or above who own qualifying silver may apply, subject to lender policies, product availability and applicable regulatory requirements.

For loans up to ₹2.5 lakh, the RBI directions do not mandate income proof or a detailed credit assessment, although lenders may apply their own internal policies. Credit history and repayment capacity may also be considered where required under lender policies and regulatory requirements.

Above ₹2.5 lakh, lenders are required to carry out credit assessment procedures in accordance with applicable requirements.

Documents Required for a Silver Loan in This UT

The typical silver loan documents file includes:

1. Photo identity proof such as Aadhaar, Voter ID or Passport
2. PAN card or Form 60, where applicable
3. Address proof showing a Silvassa, Daman or Diu address, such as Aadhaar or an eligible utility bill
4. A recent passport-size photograph
5. The silver items themselves for weighing and purity testing

Salary slips and bank statements are generally not required for smaller loan amounts, subject to lender policies. A purchase invoice or purity certificate, where available, may support the valuation process. Additional documentation requirements, if any, depend on the lender's policies, loan amount, and assessment requirements.

How to Apply for a Silver Loan in Dadra and Nagar Haveli and Daman and Diu

The process for how to apply for a silver loan generally follows these steps:

1. The application begins at a regulated lender branch in Silvassa, Nani Daman or another serviceable location, or through an online channel where available.
2. KYC documents and silver items are submitted for verification.
3. The lender valuer weighs the items and conducts purity testing in the borrower's presence.
4. A valuation certificate for recording purity, weight, deductions and assessed value is issued.
5. The loan offers detailing amount, interest rate, tenure and repayment terms reviewed.
6. Upon completion of verification and documentation, funds may be disbursed in accordance with lender procedures.

Two borrower protections apply under the framework:

• Bullet-repayment consumption loans are capped at a maximum tenure of 12 months.
• Following full repayment, pledged silver is required to be returned within seven working days, with compensation provisions applicable for lender-attributable delays.

How IIFL Finance Supports Silver Loan Applicants in Dadra and Nagar Haveli and Daman and Diu

IIFL Finance may offer a silver loan in Dadra and Nagar Haveli and Daman and Diu, subject to product availability, borrower eligibility, collateral assessment, internal policies and applicable regulatory requirements.

The loan application process may involve collateral assessment, purity testing, valuation, documentation review, and disclosure of applicable loan terms. Loan amount, tenure, charges, eligibility and repayment conditions are determined in accordance with lender policies and regulatory requirements.

Subject to applicable regulatory requirements and lender policies, funds obtained through a silver loan may be used for various legitimate personal or business-related purposes:

• Working capital for a retail business
• Equipment repair or replacement expenses
• Raw-material purchases for small enterprises
• Education-related expenses
• Medical expenses
• Household cash-flow requirements

Valuation is carried out in accordance with applicable regulatory requirements and lender procedures. Pledged items remain in safe custody during the loan tenure.

Repayment obligations, loan tenure and payment schedules are determined in accordance with applicable loan terms, lender policies and regulatory requirements. Interest rates, charges and eligibility criteria may vary based on lender policies and borrower circumstances.

Conclusion

A silver loan in Dadra and Nagar Haveli and Daman and Diu allows eligible silver ornaments and qualifying bank-sold silver coins to be used as collateral for secured borrowing, subject to lender assessment and applicable regulatory requirements. This guide has covered the regulatory LTV framework, silver loan eligibility, accepted collateral, required silver loan documents, loan valuation concepts, and how to apply for a silver loan within the Union Territory.

IIFL Finance may offer the product subject to borrower eligibility, product availability, collateral assessment and prevailing regulatory requirements. Actual loan amounts, silver loan interest rate structures, charges and other terms vary by lender, borrower profile and applicable policies. Valuation procedures, disclosures, and collateral handling are carried out in accordance with 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