Ways To Test The Purity Of A Gold Coin
Before taking a gold loan, you must know that gold coins are pure and not fake. Read on to know the 8 ways you can test the purity of a gold coin at IIFL Finance.
Gold loans provide funds by pledging your gold as collateral. The lender determines the gold value against the current price of the gold in the domestic market and offers a loan amount equivalent to a certain percentage of the gold value. However, before taking a gold loan, you must know if the gold you have or are looking to buy, especially gold coins, is pure and not fake.Since lenders offer the loan amount only if the gold is pure, you should follow the below-mentioned ways to understand how to check gold coin purity.
Eight Ways To Test The Purity Of A Gold Coin
1. The Stamp TestThe stamp test is one of the most common and easy ways to know the purity of a gold coin. While buying a gold coin, you should look for the BIS Hallmark written on the gold coin. This stamp indicates that the gold is of the highest purity by fineness or karats with no added metals. The standard purity in karats includes 8KT, 9KT, 10KT, 14KT, 18KT, 21KT, 22KT, and 24KT. The benchmark for fineness includes 333, 375, 417, 583, 585, 625, 570, 833, 875, 916,958, and 999 as valid purities.
2. Letter MarkingsThey are an ideal option in the list of many ways how to check the purity of the gold coin. The letter markings method requires you to read the markings on gold coins. These markings have their meanings, which are: GP (Gold Plating), GF (Gold Filled), GE (Gold Electroplated), HGP (High Gold Plating), and HEG (Heavy Gold Electroplated). If you see such letter markings and not the BIS Hallmark rating, the gold coin is not pure gold but only gold plated.
3. Weight and SizeOne of the most convenient features of gold is that it is denser than other metals, which distinguishes it from other metals quite well. If you want to know how to check gold coin purity, you can compare its weight and size with other pure gold coins. Take a gold coin you know is 100% pure and compare its weight, size and texture with the gold coin you want to analyse. It is fake if the tested coin differs in its parameters from the pure gold one.
4. The Skin TestThe skin test is one of the most straightforward tests to check the purity of a gold coin. Most jewellers and lenders for gold loans use the method, which requires rubbing the gold coin on your skin. Take a gold coin, and rub it against your skin for a few minutes. Look out for any greenish and bluish tint on the rubbed skin. Your skin will remain unaffected if the gold coin is 100% pure. However, if the gold coin is fake, the gold coin will react with the skin and result in discolouration.
5. The Float TestThe density of gold is higher than other metals at 19.32 g/ml, which can become a factor in testing the gold coin’s purity before taking a gold loan. If you want to check the purity of the gold coin, you can put the gold coin in the water. If the gold coin is 100% pure, it will sink to the bottom due to its higher density. The gold coin will float on the surface if it is fake.
6. The Magnet TestYou can use a magnet to test the gold coin’s purity which makes it convenient to check the purity of the gold coin. All you have to do is find a magnet and put the gold coin against it to see if it attracts the gold coin. Since a pure gold coin has no metal other than gold, the magnet will show no attraction. If it is a fake, the gold coin will stick to the magnet due to the presence of metal.
7. The Ceramic TestMost households have unglazed ceramic utensils or porcelain products such as tiles. You can use both to test the gold coin’s purity. Take the gold coin, and scratch it against any product to see if it leaves any mark. A pure gold coin will leave a golden mark because of the containing gold. However, if the gold coin is fake, it will leave a grey mark because of the present metals. Be cautious and do not scratch the gold coin too hard, as it can damage the product.
8. The Acid TestThe acid test process includes carefully using acids, such as vinegar or nitric acid, to test the gold coin’s purity. Put a few drops of any mentioned acids on the gold coin and observe any reaction. If the gold coin is pure, there will be no discolouration, whereas a fake gold coin will turn black, blue or green.
Avail Of An Ideal Gold Loan From IIFL FinanceOnce you know that the gold you have is of the highest purity, you can leverage the gold to raise immediate capital through an ideal gold loan. IIFL Finance has designed several gold loan products with attractive and affordable interest rates. The proprietary gold loan offers instant funds up to Rs 30 lakh with a quick disbursal process.
Q.1: What is the interest rate on an IIFL Finance loan against gold?
Ans: The average interest rates for gold loans range from 6.48% - 27% p.a.
Q.2: What are the required documents to avail of a Gold Loan?
Ans: Documents required are Aadhar Card, PAN Card, Driving License, Passport, Ration Card, Electricity Bill, etc.
Q.3: How much time does it take for the gold loan to be approved?
Ans: IIFL Finance approves the gold loan within 5 minutes of application submission.