Gold Loan Interest Rates

The gold loan interest rate is a critical factor to consider before applying for a gold loan. As you have to repay the loan over the prescribed tenure, you need to pick one with an interest rate that does not create a financial burden for you.

IIFL Finance provides gold loans at attractive and affordable interest rates with its comprehensive and customised gold loan product. It is factored in the amount of loan a borrower wants to avail of to ensure that the capital requirement is effectively fulfilled.

IIFL Finance provides utmost transparency and communicates all the rates and charges including the interest rate on the gold loan.

Additional Charges

Apart from the gold loan rate of interest that the borrowers have to pay, gold loans come with some additional charges. These charges are levied on the borrowers because of the additional services rendered by the lending company, such as IIFL. However, IIFL Finance understands that such charges are to be borne by the customer and hence, has designed the gold loan product to carry a few additional charges.

With an attractive and affordable gold loan rate of interest, IIFL Finance’s additional charges are nominal. The processing fee varies depending on the availed gold loan scheme starting from Rs 0 onwards. Furthermore, the MTM charges on IIFL’s gold loan are the lowest in the industry at a flat Rs 500.

These additional charges are listed with utmost clarity on IIFL Finance’s website to let you analyse their payment obligations before taking a gold loan. Additionally, there are no hidden costs attached to IIFL Finance’s gold loan.

Factors Affecting Gold Loan Interest Rates

Numerous factors can affect the loan against gold interest rate in India. Some of them are influenced by personal factors relating to the borrower, while others are external relating to the current economy and the domestic gold prices:

Loan Amount

The loan amount plays a critical role in determining the best gold loan interest rate.

Monthly Income

Although gold loan borrowers don’t face many difficulties in getting a gold loan approved from the lender, they may require knowledge of your monthly income during the loan application process. The monthly income amount defines the repayment capacity of the borrower.

Benchmarking

Lenders follow two types of benchmarking methods to determine the loan against gold interest rate: Repo rate-linked lending rate, and MCLR-linked lending rate. The interest rate on a gold loan varies from one lender to another, depending on the chosen benchmarking method. Generally, MCLR-linked lending rates result in a gold loan lowest interest rate offered by lenders.

Credit Score

Although gold loans do not factor in the credit score of the borrower for eligibility criteria, the credit score can still affect the interest rate on the gold loan for a borrower. If the borrower has defaulted multiple times on interest payments before and has a bad credit score, it is a possibility that the lender will offer the gold loan at a higher interest rate.

Gold Value

One of the most important factors that influence the loan against the gold interest rate is the value of the pledged gold. Every borrower has to pledge gold articles to the lender, and they offer a percentage of the total value of the gold articles as the loan amount.

Repayment Frequency

The interest repayment frequency on your loan amount also alters rate of interest.

Gold Loan Interest Rate FAQs

Although taking an interest-free gold loan may be possible, the situation is very rare. At IIFL Finance, you can take a gold loan at a nominal interest rate with no hidden charges.

Was this helpful?

Yes, interest rates vary based on the kind of gold jewellery you have. The loan against gold interest rate also depends on the purity of the gold jewel.

Was this helpful?

Yes, farmers may get a discount on loan interest rates. However, the product differs and is called an agriculture gold loan.

Was this helpful?

This interest rate on a gold loan is the amount charged by the lender above the loan amount based on the value of the pledged gold. Such interest rates may range between 9.96% - 27% per annum.

Was this helpful?
Show More Show Less

IIFL Gold Loan Interest Rate Insights

Does Taking Gold Loan Affect My Credit Score?
Gold Loan Does Taking Gold Loan Affect My Credit Score?

Gold Loan is a loan wherein gold jewellery is prov…

How Can I Tell If My Gold Coin Is Real?
Gold Loan How Can I Tell If My Gold Coin Is Real?

People consider investing in gold coins and bars…

An Overview Of The Gold Loan Market In India And How It Is Growing
Gold Loan An Overview Of The Gold Loan Market In India And How It Is Growing

Banks and non-banking finance companies (NBFCs) t…

How Safe Is Your Physical Gold In A Bank Locker?
Gold Loan How Safe Is Your Physical Gold In A Bank Locker?

Physical gold is one of the most prized possessio…