Mar 272017

Gold Loan Scheme Farmer | Gold Loan Scheme In SBI

What is Gold Loan?

When it comes to gold loan many people are confused. Gold Loan in fact refers to the act of taking a certain sum of money against gold jewelry or items. Banks like SBI, ICICI and others offers up to Rs. 20 lakh against gold valuables as gold loans. Those who have to meet urgent financial needs can take gold loans from banks.

What is the Gold Loan Scheme?

The gold loan scheme is a scheme whereby the public can take gold loans to meet their existing requirements. Such scheme is valid for farmers, agriculturists and other recipients. One can fulfill any kind of requirement with the money offered via this scheme. However, the use of this money for any illegal activity is prohibited. One can use the money for marriage, going on vacation, building a house or for educating a child.

Features of the Gold Loan Scheme

  • At its minimum, Rs. 10,000 will be given against the gold jewelry to the residents of the rural and semi-urban areas. 20,000 is allotted to the residents of urban and metro cities.
  • So you can avail any amount as your loan, as long as it is within Rs. 20 lakh and above Rs. 10,000 (for rural) and above Rs. 20,000 (for urban and metros). This is the range specified.
  • The rate of interest charged for this type of loan is very low because you are leveraging your gold ornaments against it. This is why it is easier to pay off these loans in the stipulated time.
  • The bank, as a rule, retains a value of 25% of the price of the gold at present. Hence, you will be granted 75% of the present market value of the gold against it. The bank retains the 25% margin.
  • You can repay the loan within 30 months. Sometimes the tenure is 36 months. It all depends upon the type of loan that you have taken. 30 months is the tenure for demand loan whereas 36 months is the tenure for overdraft loan. However, the period of repayment cannot exceed 2.5 years.
  • You can pledge either gold ornaments which you have or gold coins issued by the bank. The process of disbursement of the loan takes minimal time. As soon as you produce the documents you are sanctioned the loan.

Am I eligible for the loan?

  • The applicant has to be over 21 years of age to avail the loan. Apart from this, there is just one other criteria. However, if you are under 70 years of age you can easily avail this loan.
  • You should also have a steady source of income. It is also possible to take the loan if you are on a regular pension. So you need to have a steady source of income to avail this type of loan.

What kind of documents do I need to provide?

  • Two passport size photographs: Make sure that the photographs are recent and that you have taken them right before you have gone to take the loan. This way if there are changes in your appearance it can be noticed.
  • ID Proof and address proof: You need ID proof and address proof such as PAN card and driving license. You can also submit Aadhar card or ration card as ID proof. For the address proof you can produce passport copy, Aadhar card, 3 months utility bill, etc.

What is the maximum amount of loan?

The maximum amount of loan is fixed at Rs. 1800 per gram of pure gold. This is against the prices that are prevalent in the market at the present moment when the loan is being taken. The purity of the gold will be tested before the loan is sanctioned. Usually 24 carats of gold is known as 100% pure gold.

How to choose the right loan scheme?

In case you have any doubts about the right gold loan scheme, visit the nearest bank branch. You will find a support desk at the loan. They will explain to you the loan scheme. All the loans are distributed via the local delivery channels that are the bank branches. Therefore you have to speak to your closest bank in order to avail the gold loan.

Serial No. Processing fee for Loan amount up to Rs. 25,000 Loan amount from Rs. 25,000 to Rs. 20 lakh
1 Non hall marked jewelry and Gold Coins 0.5% of loan amount given + ST 0.5% of loan amount given + ST
2 Hall marked jewelry Rs. 250 + ST Rs. 500 + ST or 0.5% of loan amount given + ST
3 Interest rate 2% for 1 year and MCLR 9.15% 2% for 1 year and MCLR 9.15%

The entire interest rate charged comes to about 11.15%. The MCLR per annum is 9.15%. This makes the interest rate come to 11.15% per annum. This is why the figures mentioned above are always a subject to changes in the government policies. Hence they might keep fluctuating. These are the current interest rates mentioned.



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