Lowest Gold Loan Interest Rates 2025: A gold loan is a loan people take when they give their gold jewellery or coins to the bank as security. The bank gives money against that gold, and the borrower pays interest on the loan until they return the money.
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This interest is called the gold loan interest rate. In India, the interest rate on gold loans usually falls between 8% and 27% a year. Borrowers can repay in small monthly instalments or as a single payment, depending on what the bank allows.
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 |
What banks are offering right now?
Big banks in India are giving gold loans at different rates. The State Bank of India charges 10% per year, so if you take one lakh rupees for one year, the monthly EMI comes to ₹8,792. Punjab National Bank has cheaper rates, starting at 8.35 percent. A loan of one lakh for a year here costs ₹8,715 per month.
Bank of India gives gold loans at 8.6% yearly, which means the EMI for one lakh over a year is ₹8,727. Canara Bank starts from 8.9%t, and on a one lakh loan, the EMI is ₹8,741. Kotak Mahindra Bank charges a little higher, beginning at 9%. That means for the same loan amount and duration, you pay an EMI of ₹8,745. These examples show how even small changes in rates slightly change the money you pay every month.
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.
Why gold loans are preferred?
Gold loans are simple, quick, and safe. Banks do not need too many papers, and they give the loan fast. The gold stays with the bank until the loan is paid back, and once repayment is complete, the borrower gets their jewellery back.
The repayment time can be short, sometimes just three months, or it can go up to three years. People can pay interest every month, or they can pay it all at once later. Some even make partial prepayments if they have extra money.
Another advantage is that your credit score does not stop you from getting the loan. The approval depends more on the gold value than your past borrowing record. But your credit history can still decide what interest rate you get.
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What affects gold loan rates?
Different things affect the rate banks offer on gold loans. If a person earns a stable monthly income, the bank feels safer giving the loan and usually charges less interest. RBI rules allow banks to lend up to 75 percent of the gold’s value, so if gold prices are high, the loan size goes up, and banks may charge lower rates.
Bigger loans can sometimes carry higher rates. On top of that, gold loan rates are tied to benchmarks like the RBI repo rate or the government bond rate. So if RBI changes its policy rate, the gold loan rates can change too. A good CIBIL score helps a lot, If a borrower shows a strong credit history, banks trust them more and give them lower rates.
