Ever looked at your gold jewellery and thought, “This could actually help pay for my child’s college fees”? You’re definitely not alone. Gold loans have quietly become one of India’s most trusted ways to handle sudden financial needs. It’s pretty simple—give your gold to a lender as security, get up to 75% of its current market value as a loan, and repay it with interest.
With gold prices rising, buying more might seem out of reach—but taking credit against your existing gold definitely makes sense.
Once that’s done, your gold comes right back to you, safe and sound. No need to sell family heirlooms or dip into long-term savings. With gold prices soaring in 2025, many people are choosing to pledge their gold rather than break fixed deposits or rely on high-interest credit cards. Platforms like Bajaj Markets make the process even easier, letting you compare multiple lenders in one place. Plus, with fast online applications, quick approvals, and interest rates starting at 8.88% p.a.*, gold loans are becoming the go-to solution when money’s tight.
Gold loans are secured loans where individuals pledge physical gold- mostly jewelry or coins—to get funds from a lender. The loan amount depends on the purity and weight of the gold, with most lenders offering up to 75% of its current market value, also known as the Loan-to-Value (LTV) ratio. The gold remains in the lender’s custody until the borrower repays the entire loan along with interest. Once the dues are cleared, the gold is returned. These loans typically come with shorter tenures ranging from a few months to three years, making them ideal for short-term financial needs.
Borrowers prefer gold loans over personal loans for several reasons. They come with lower interest rates, require no income proof, and credit scores aren’t a big deal. Ideal for funding back-to-school expenses, medical emergencies, and festive needs, gold loans ensure you don’t have to break your long-term investments. Plus, processing is swift, and documentation is minimal. The ease of access and flexible options have made gold loans an increasingly popular choice.
| Feature | Gold Loan | Personal Loan |
|---|---|---|
| Security | Gold collateral | Unsecured |
| Processing Time | Fast (hours) | Slower (1-3 days) |
| Interest Rate | From 8.5% p.a.* | From 10-28% p.a. |
| Credit Score Needed | Not essential | Crucial |
| Documentation | Minimal | Moderate |
Gold loans can be a real lifesaver in tough times, but like any financial product, they come with their own set of risks. The biggest one? If you miss your repayments, your gold could be auctioned off by the lender. Also, if gold prices drop, lenders might lower the loan-to-value (LTV) ratio, which could mean you’ll need to pay more to maintain your loan—something called a margin call. On top of that, some lenders may charge high processing fees or penal interest if you’re late. That’s why it’s so important to borrow responsibly, understand the terms, and know exactly what you’re signing up for. Before pledging your jewellery, make sure you’re confident about repaying the loan. Using platforms like Bajaj Markets, Axis Bank Securities, HDFC can help you compare different lenders, interest rates, and terms—all in one place—so you can make an informed choice and avoid any surprises later.
(With Inputs From ANI)
Also Read: TCS Share Price: How Positively Are They Trading Before The Company Opens Its Profit And Loss Book?
Aishwarya is a journalism graduate with over three years of experience thriving in the buzzing corporate media world. She’s got a knack for decoding business news, tracking the twists and turns of the stock market, covering the masala of the entertainment world, and sometimes her stories come with just the right sprinkle of political commentary. She has worked with several organizations, interned at ZEE and gained professional skills at TV9 and News24, And now is learning and writing at NewsX, she’s no stranger to the newsroom hustle. Her storytelling style is fast-paced, creative, and perfectly tailored to connect with both the platform and its audience. Moto: Approaching every story from the reader’s point of view, backing up her insights with solid facts.
Always bold with her opinions, she also never misses the chance to weave in expert voices, keeping things balanced and insightful. In short, Aishwarya brings a fresh, sharp, and fact-driven voice to every story she touches.
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