Gold Loan Interest Rate

Gold loan interest rates are a critical factor in the gold loan industry, influencing the overall cost of borrowing and the affordability of the loan for the borrower. At IIFL Finance, we don't just offer some of the lowest gold loan interest rate; we offer a gateway to your dreams, that makes borrowing accessible and flexible. We understand that the loan amount you seek is crucial, and our gold loan schemes are carefully designed to guarantee that your capital needs are successfully satisfied. And we have mentioned interest rate changes in the table below to provide the highest level of transparency.

Gold Loan Interest Rates And Charges Table

Interest Rate 0.99% onward p.m.
(11.88% - 27% p.a.)
Rates varies depending on scheme availed
Processing Fee[1] As per Scheme Construct
Penal Charges (w.e.f 01/04/2024) 0.5% p.m (6% p.a) + GST on outstanding due amount[2]
MTM Charges[3]* ₹500.00
Stamp Duty and other statutory charges As per applicable laws of the state
Auction Charges* ₹1500.00
Overdue Notice Charges* ₹200 per Notice
SMS Charges* ₹5.90 per Quarter
Part-Payment Charges NIL
Pre-Closure Charges NIL
Minimum of 7 days interest will be charged if loan is closed within 7 days

*Charges are inclusive of GST

[1] Processing fee is subject to the availed scheme and loan amount. The applicable rates are mentioned in the loan sanction letter at the time of disbursement.

[2] Outstanding due amount for this purpose includes the Principal outstanding and Interest accrued. Penal charges will not be levied on the outstanding penal due amount.

[3] MTM Charges shall be as defined in the T&C.


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. 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 are the lowest in the industry at a flat Rs 500.

These additional charges are listed with utmost clarity on our website to let you analyse their payment obligations before taking a gold loan. Additionally, there are no hidden costs attached. IIFL Finance stands out by offering not just the most competitive gold loan interest rates in the market but also keeping these additional charges remarkably low compared to industry standards. This customer-centric approach ensures our gold loan offerings remain highly attractive and accessible to borrowers seeking financial assistance.

Factors Affecting Gold Loan Interest Rates

Gold loan interest rates play a pivotal role in determining the overall cost of borrowing and the affordability of the loan for the borrower. These rates are influenced by dynamic factors, including the market price of gold, inflation and loan tenure.

Loan Amount

The loan amount plays a critical role in determining the gold loan interest rate. According to RBI’s guidelines, IIFL Finance gives you up to 75% of the total value of gold you pledge. We consider factors like loan amount and repayment tenure to determine the interest rate applicable to your gold loan.

Gold Value

The market value of gold directly affects the pledge gold jewellery as collateral. Higher gold purity (like 22k vs 18k) means more of the valuable metal in your gold asset, boosting its worth and lowering your interest rate. Depending on conditions of gold jewellery and quality, the loan amount might get impacted.‌.

Market Conditions

The interest rates and the cost of a gold loan per gram can be affected by changes in the market demand. If gold prices are high, the risk of the lender is low, whereas if gold prices are low, the lender's risk increases, and interest rates would go up.

Repayment Frequency

For loan repayment - we have multiple options available where you can choose to repay the interest amount on monthly, quarterly, and yearly basis as per your requirement. The interest rate would vary depending on the tenure you choose for a gold loan. 

Calculation of Gold Loan Interest Rate

Two main factors affect the calculation of the gold loan rate of interest:

  1. Loan Amount : The gold loan amount you want to borrow is the primary factor in calculating the rate of interest of the gold loan. The higher the loan amount, the higher the overall interest rate.

  2. Loan Tenure : The loan tenure specifies the period of your monthly loan repayment obligations. The higher the loan tenure, the lower the interest rate.

Visit the IIFL website to use the gold loan calculator , and calculate your gold loan amount in a few simple steps by putting in the desired loan amount, value of gold articles and the loan tenure.

Always remember that the gold loan interest rate depends on the specific loan scheme chosen and its tenure. This knowledge of gold loan interest rates is paramount as it directly impacts the overall borrowing cost of the loan. Consequently, securing a gold loan with a low-interest rate can significantly reduce repayment costs and alleviate financial strain.

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.

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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.

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

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Gold loan interest rates are the charges you pay to borrow money against your gold jewellery as collateral. These rates vary among lenders and are determined by factors such as the loan amount, loan tenure, borrower's creditworthiness, and the current market conditions.

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EMI-based gold loan functions as any other loan, where the full amount is disbursed after the processing of application and the repayment is made in equated monthly installments as per gold loan scheme availed

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The gold loan interest rate charges depends on gold loan scheme and tenure availed

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Yes, you can pay only the interest on a regular basis and settle the principal amount at the end of the gold loan tenure.

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The maximum gold loans tenure is 24 months

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