Loans provide financial help by authorized banking organizations like banks and Non-Banking Financial Companies (NBFCs) to customers based on specific eligibility criteria. Loans by these lenders are broadly classified as secured and unsecured. Collateral is mandatory for a secured loan, and gold loans require a gold asset as collateral. It can be necklaces, chains, bangles, earrings, rings, bracelets, coins, bars, or any other form of gold. The loan is granted for a specific period known as tenure or loan term. The bank or financial institute that sanctions the loan needs the borrowed loan amount to be paid back in full with interest by the end of the tenure. A gold loan can be availed both digitally and in person these days.
An online application form is available on the official website of the bank or NBFC, and filing it with scanning and uploading the requested original documents, and mentioning the required loan details is the total application process in online mode. The offline method includes submitting the application and required documents in person with the collateral and getting loan approval and money from the lender on the spot. Either way, the bank and financial institutes support and offer only the easiest and convenient requirements. A gold loan interest calculator on the bank’s official website or NBFC can be used to know more about the interest and loan details of a gold loan.
The banks and financial institutes provide innumerable loans, and each loan is granted on a certain basis. An unsecured loan like a personal loan is granted based on the applicant’s monthly income, bank statement, CIBIL score and many other documents. A car loan is based on the car details, monthly income, CIBIL score, a business loan needs proof of business, in addition to income proof, CIBIL score, etc.… Like these, many loans have many requirements. The formerly mentioned loan is unsecured, whereas the latter two is a secured loan like a gold loan, but one can see that it requires both income proof and CIBIL score, two essential details, but a gold loan doesn’t need those loans two essential details. It is because of the collateral, i.e. security in a gold loan. A gold loan’s collateral, as mentioned earlier, is gold. And gold, as everybody knows, is abundant and excessively used mainly owing to its convenience and ease of carrying. The gold loan’s collateral remains with the bank or NBFC a borrower avails loan on and is only returned after the borrower pays what’s owed.
Therefore, banks and financial institutions eventually trust a gold loan more than other loans. All that is required in a gold loan is an applicant of legal age who isn’t beyond the age of 75 years. Two photocopies, a government-authorized ID proof(PAN card, Aadhar card, Voter id, driving license, passport, or any other valid proof of id), a filled application form, collateral is enough for approval of a gold loan. No CIBIL score requirement or income proof necessity is present. This makes a gold loan more attractive and beneficial. The processing of the gold loan is also speedy because of its minimum requirement, and the principal amount is disbursed soon after the application’s approval. A gold loan can be used for any reason and preferred by most of the world.
The Non-Banking Financial Institute Manappuram Finance Limited is a well-known eminent lender of many loans. The gold loan provided by this financing company is one of the top ten gold loans. The loan amount granted is a maximum amount of Rs 1.5 crore, up to 90% of the gold’ value. Manappuram gold loan rate per gram starts from Rs 3,506. The interest rate of the gold loan starts from 7% per annum. The tenure is a minimum of 3 months and a maximum of 3 years in Manappuram Finance Limited.