Gold Loan Interest Rates 2025: Lowest Gold Loan Interest Rate in India

Updated on: Aug 28th, 2025

9 min read

A gold loan is a secured loan where you pledge gold jewellery or coins to access funds for personal or business needs. In 2025, gold loan interest rates in India range from 8.05% to 27% p.a., depending on the lender, loan amount, gold purity, tenure, and whether you choose a bank or NBFC.

In this guide, you’ll find the latest gold loan interest rates for 2025, along with eligibility, documentation, repayment options, and a comparison of top banks and NBFCs.

What is the Gold Loan Interest Rate?

A gold loan interest rate is the percentage charged by banks or financial institutions against the loan amount provided when borrowers pledge gold as collateral. In India, gold loan interest rates generally vary between 8% and 27% per annum. Borrowers can repay the interest either in monthly instalments or as a lump sum based on the lender's terms.

Gold Loan Interest Rate Provided by Top Banks in India 2025

The table below compares the rate of interest charged against the gold loan provided by top banks in India, along with the loan amount and tenure for 2025:

Bank	Interest Rate (p.a.)	Loan Tenure	Processing Fee	Limit
SBI	8.75% onwards	Up to 36 months	0.25% of the loan amount	Rs. 20,000 - Rs. 50 Lakhs
Canara Bank	8.75% onwards	Up to 12 months	Up to Rs. 2,750 + GST	Up to Rs. 35 Lakhs
Union Bank of India	9.1% – 9.35%	Up to 12 months	0.50% of the loan amount + GST	Up to Rs. 50 Lakhs
Indian Overseas Bank	8.20% – 11.60%	Up to 12 months	Varies by loan amount	Rs. 25,000 - Rs. 50 Lakhs
PNB	8.35% Onwards	12 months	0.30% of the loan amount + GST	Rs. 25,000 - Rs. 25 Lakhs
Karnataka Bank	10.03% – 10.48%	Up to 12 months	NIL	Up to Rs. 50 Lakh
Bank of Baroda	9.00% onwards	Up to 36 months	Applicable charges +GST	Up to Rs. 50 Lakhs
HDFC Bank	9.30% – 17.86%	6 to 42 months	Up to 1% of Disbursal Amount + Taxes	Rs. 25,000 - Rs. 1 Crore
Federal Bank	9.99% onwards	Up to 12 months	NIL	Rs. 3000 - Rs. 1.5 Crore
Central Bank of India	8.05% – 8.35%	Up to 12 months	0.25% of the loan amount + GST	Rs. 10,000 - Rs. 40 Lakhs
Bank of India	8.6% – 8. 75%	Up to 12 months	Up to Rs. 1,500	Rs. 20,000 - Rs. 30 Lakhs
ICICI Bank	9.15% – 16.75%	Up to 12 months	Up to 2%* of the loan amount	Up to Rs. 2 Crores
Axis Bank	9.75% – 17.00%	6 to 36 months	0.5% of the loan amount + GST	Rs. 25,001 - Rs. 40 Lakhs

Comparison of Gold Loan Interest Rates Provided by Top Non-Banking Institutions in India

Given below is a comparative outline of varying gold loan interest rates provided by different financial institutions in India other than leading banks:

Name of the Lender	Interest Rate (p.a.)	Processing Fees	Loan Tenure
Bajaj Finserv	9.50% to 24%	0.15% of the loan amount	Up to 12 months
Muthoot Finance	12.5% to 22%	Rs. 100 to Rs. 1,000	12 months
IIFL	11.88% - 27%	upto 2% of loan amount	24 months
Manappuram Finance	9.90% to 21.67%	Rs. 25 + Tax	Around 3 months

Features of Gold Loan

Gold loans provide a convenient and secure borrowing option for individuals who require quick access to funds by pledging their gold assets.

Secured loan using gold jewellery or coins as collateral.
Quick disbursal and minimal documentation.
Short repayment tenures ranging from 3 months to 3 years.
Interest payment options include EMI, bullet repayment, or partial prepayment.
No impact of credit score on loan approval, but it may affect the interest rate.
Lower interest rate compared to a personal loan.
Pledged gold is returned on successful repayment.

Eligibility for Gold Loan

The eligibility criteria for a gold loan vary by lender. Hence, check the criteria outlined on the lender's website before applying for a gold loan.

Here are some common eligibility criteria set by most lenders in India for gold loans:

An applicant should be 18 years of age or above.
He/she must pledge gold ornaments or articles as security against the loan.
The applicant should pledge gold of 18 carats or above as security.

Documents Required to Apply for Gold Loan

The list of documents required at the time of applying for a gold loan varies, depending on the lender’s terms and conditions. Here are the documents that are commonly needed for a gold loan:

Duly filled and signed gold loan application form.
Latest passport-size photographs of the applicant.
PAN card or Form 60.
Proof of Identity (Aadhaar card, Voter ID card, driving license, etc).
Proof of Address (Passport, utility bills, rental agreement, etc).
Age Proof (Birth certificate or school passing certificate).
Signature proof.
Other post-loan disbursement documents (if required).

Gold Loan Processing Fee and Loan Appraiser Charges

Here are the applicable processing fees and loan appraiser charges of different leading banks in India:

SBI Gold Loan:
- Rs. 200 + GST (3-month Bullet Repayment)
- Rs. 300 + GST (6-month Bullet Repayment)
- 0.50% of loan amount (min Rs. 500, max Rs. 10,000 + GST) for 12-month Bullet Repayment
- 0.50% of loan amount (min Rs. 500 + GST) for EMI-based loan
HDFC Gold Loan: Up to 1% of disbursal amount (inclusive of applicable tax)
Axis Gold Loan:
- Rs. 300 per case (for fresh loan up to Rs. 3 lakh)
- 0.5% of loan amount (for renewed loan above Rs. 2 lakh)
Canara Gold Loan:
- 0.50% of loan amount (min Rs. 500, max Rs. 5,000) for Swarna Overdraft Gold Loan
- Rs. 2,750 for MSME & Agricultural Gold Loans above Rs. 10 lakh
BOB Gold Loan:
- Nil up to Rs. 3 lakh
- Applicable as per bank’s terms and conditions (with GST) for loans above Rs. 3 lakh up to Rs. 50 lakh

Karnataka Bank Gold Loan: No limit specified
PNB Gold Loan: 0.30% of loan amount + GST (or Rs. 500 + applicable tax, whichever is higher)
Kotak Gold Loan: Up to 2% of loan amount + applicable GST
Federal Gold Loan: Up to 3% of loan amount + applicable GST
Central Bank of India: 0.50% of loan amount (min Rs. 250, max Rs. 5,000)
Indian Bank Gold Loan: Nil
IDBI Bank Gold Loan: 1%
IndusInd Bank Gold Loan: 1% of loan amount + GST

Factors Influencing Gold Loan Interest Rates

Here are some of the factors that influence gold loan interest rates offered by prominent banks and financial institutions in India.

Monthly Income: A stable monthly income assures lenders of your ability to repay, often resulting in lower interest rates.
Gold Market Rate: The Loan to Value (LTV) ratio, set by the RBI, allows banks to lend up to 75% of the pledged gold’s value. A higher gold price means higher collateral value, leading to lower interest rates.
Principal Loan Amount: Larger loan amounts typically come with higher interest rates. It’s important to assess your exact requirements before applying.
External Benchmark Lending Rates: Gold loan interest rates are linked to external benchmarks like the RBI repo rate or the 10-year government bond rate. Any adjustments to policy rates can directly affect the interest rate on your gold loan
Credit Score: A good credit score (CIBIL score) improves your chances of securing a lower interest rate. Lenders consider a strong credit history as a sign of reliable repayment.

Gold Loan Interest Rate Calculator

A gold loan calculator is a financial tool readily accessible online that computes the approximate value of the loan amount you can avail. It can also determine the amount of interest you will be liable to pay against a gold loan, along with the monthly EMI amount.

This tool proves to be valuable for borrowers planning to apply for a gold loan, offering them an estimate of their repayment liability.

How to Calculate Gold Loan Interest Rate?

The interest amount payable on a gold loan, as determined by the interest rate, can also be calculated using the following mathematical formula.

P x R x (1+R)^N / [(1+R)^N-1]

Where,

P = Principal amount
R = Rate of Interest (annual)
N = Loan tenure (in months)

Example:

Suppose you want to avail a gold loan of Rs. 1 lakh from a leading bank in India, charging 7.2% interest for 3 years.

By incorporating the values into the formula, you will find that

The amount payable = 1,00,000 * 0.006 * (1 + 0.006)36 / ((1 + 0.006)36 – 1)

= Rs. 1,11,487

How to Apply for a Gold Loan?

You can apply for a gold loan through both online and offline methods. Before starting the application, ensure you research lenders offering lowest gold loan interest rate, flexible terms, and check their eligibility criteria and documentation requirements.

Online

The following is a step-by-step guide on how to apply for a gold loan online.

Step 1: Visit the official website of your desired lender.

Step 2: Navigate to the ‘Gold Loan’ section under ‘Loan Products’.

Step 3: Look for the ‘Apply Now’ tab on the ‘Gold Loan’ page and click on it. You will be redirected to a new page displaying an application form.

Step 4: Fill it up carefully with all the required details.

Step 5: Click on the ‘Submit’ tab after verifying.

Offline

If online application isn’t available, follow these steps to apply offline:

Step 1: Visit the nearest branch of your preferred lender, along with the required documents.

Step 2: Consult with a branch representative and obtain a gold loan application form.

Step 3: Fill out the form with accurate details and attach the supporting documents.

Step 4: Submit it to the branch representative.

Once your application is submitted and verified, your gold loan will be processed and sanctioned.

How to Close a Gold Loan?

There are 4 ways of closing a gold loan. Let us discuss these methods in detail.

By paying the interest amount as EMI and the principal amount

In this method, borrowers pay the interest in small monthly installments (EMIs) throughout the loan term. The principal is paid as a lump sum at the end of the tenure.

By paying regular EMIs

Borrowers pay both the principal and interest as equal monthly EMIs over the loan period. This method is ideal for salaried individuals with a stable monthly income.

By making bullet repayment

In this method, borrowers pay the entire principal and interest in one lump sum at the end of the loan term. It provides flexibility for those with fluctuating incomes.

By making partial payments or foreclosure

Borrowers can choose to repay the loan early by making a partial or full payment of the loan principal and interest before the term ends.
This can help save on interest costs and reclaim the pledged gold items sooner. It’s suited for financially secure individuals.

While a gold loan can be an attractive funding option, borrowers should always prioritize finding the lowest interest rates and flexible terms before committing to a loan. Equally important is evaluating your financial ability to repay the loan, ensuring that you can comfortably meet the repayment obligations before choosing this option.

Other Banks Gold Loan Interest Rates:
1. ICICI Bank Gold Loan Interest Rate
2. Central Bank Gold Loan Interest Rate
3. Union Bank Gold Loan Interest Rate
4. Indian Overseas Bank (IOB) Gold Loan Interest Rate

Frequently Asked Questions

Which bank has the lowest gold loan interest?

Kotak Mahindra Bank offers the lowest gold loan interest rate, starting from 8%.

What is the interest of a Rs. 1 lakh gold loan?

The rate of interest on a loan against Rs. 1 lakh gold ranges between 8% to 24%, or even higher, depending on factors such as prevailing economic conditions or the type of lender.

Can we get a 100% gold loan?

No, it is not possible to avail a 100% gold loan. An individual can obtain a loan of up to 75% of the current market value of their gold in India.

What are the limitations of a gold loan?

Although an appealing financing option, there are some risks associated with a gold loan. One key limitation of such a loan is the possibility of the lender freezing your pledged articles and selling them off in an auction to release the outstanding loan amount in the event of default.

What is the highest amount for a gold loan?

In India, the highest amount for a gold loan is Rs. 1.5 crore.

What is the maximum gold loan amount in SBI?

The maximum loan amount provided by the State Bank of India against gold is Rs. 50 lakhs.

What is the interest rate for agricultural gold loans?

The interest rate on agricultural gold loans offered by leading financial institutions is 7%.

How to calculate the interest rate for a gold loan?

The interest on a gold loan can be easily determined by either using an online calculator or a mathematical formula.

How can I check my SBI gold loan status?

You can track your SBI gold loan status by visiting the official website of the State Bank of India. For this, you need to specify your reference number and mobile number along with your ISD code.

What is the Loan-to-Value (LTV) ratio, and how does it affect the interest rate?

The loan-to-value ratio is the maximum percentage of the gold value that can be lent. In India, the RBI allows up to 75% LTV. Higher gold prices or lower LTV generally result in better interest rates.

Are gold loan interest rates fixed or floating?

Gold loan interest rates can be either fixed or floating. Banks usually offer fixed rates, while NBFC lenders may offer both options.

What are the main factors that determine my gold loan interest rate?

The main factors include loan amount, gold purity and weight, loan tenure, applicant's income, credit history and current gold market rate.

Are interest rates from banks lower than NBFCs?

Interest rates from banks are generally lower than those from NBFCs. However, NBFCs offer faster processing and more flexible terms.

Can I negotiate the gold loan interest rate?

Yes, you can negotiate the interest rate, especially if you have a good relationship with the lender or pledge gold of higher purity and weight.

About the Author

Mayashree Acharya

Senior Content Writer

I am an advocate by profession and have a keen interest in writing. I write articles in various categories, from legal, business, personal finance, and investments to government schemes. I put words in a simplified manner and write easy-to-understand articles. Read more

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