Gold loans provide affordable credit to individuals using gold jewelry as collateral. Key benefits include low interest rates, a quick application process requiring few documents, high loan amounts up to 75% of the gold's value, and no credit score or income certification requirements. Gold loans also have faster disbursal times than other loans. While repayments for other loans are typically through EMIs, some gold loan schemes allow paying just the monthly interest with the principal due at maturity. The document recommends Manappuram Finance as one of the top gold loan providers in India.

1. Gold Loan
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2. Introduction
• Gold has occupied a special place in the socio-economic milieu of India. It is considered to
be an important asset, a hedge against inflation and an immediate source of cash.
• The interest rates offered on gold loans are extremely affordable.
• In rural areas in India, due to the lack of access to banks the poor continue to invest their
savings mainly in gold. Also, there are strong cultural factors at work in India that make
gold a desirable and a necessary asset to hold.
• A gold loan is a credit against gold. Under this loan, gold jewellery is taken as
security by the lending bank/NBFC. The advance is given to the borrower
against this gold as insurance. Also, the interest rate on the gold loan is lower
than unsecured loans.

3. Benefits of Gold Loans
• Low rates of interest
• Easy process
• High Loan to Value
• No certification of income required
• Few documents
• Credit score is not considered
• Quick procedure
• Typically up to 75% of the gold item’s value

4. Gold Loan V/S Other Loans
• Gold loan is a secured loan and the disbursal time is very quick in this type of a loan.
Generally, the amount is credited to the borrower’s account within one hours. However,
other loan application sanction can take 3 to 7 days
• Any person who is above 18 years can apply for the gold loan and there is no minimum
income required. However, to apply for a other loan, a salaried employee should have a
minimum income of ₹ 25,000.
• Gold loans come with minimal processing charges as low as Nil and some lenders charge
0.10%-1% of the loan amount. In other loans, the processing fees go up to 2.50% of loan
amount.
• Other loans have an option of repayment in the form of EMIs (including interest as well as
principal amount), however, in some gold loan schemes lenders allow the borrowers to
pay the interest every month, and principal amount can be paid on maturity.

5. Best Gold Loan Provider
Manappuram Finance Ltd is one of the top NBFC with its base in Kerala, named as
the largest wealth creator for the year 2019 in the list of ET500 companies with a market
capitalization of over `50 billion( Annual report, Manappuram Finance, 2019-20). It is the
second-largest gold finance NBFC in India. The Company provides loans against the
pledge of used household gold jewelry and extends short-term gold loan primarily to
customers who require funds immediately and may not have access to formal credit.
Gold Loan Click here for instant gold loan

6. Conclusion
For most Indian households, gold remains the most preferred avenue of investment.
Further, the constant rise and fall in gold prices present vivid opportunities for investors to
procure the shining metal. In the long run, gold offers a lucrative opportunity of availing a
loan. It is fair to conclude that availing loans against gold assets is a more profitable option
than availing personal loans.