Gold has always been India's most trusted asset during emergencies. A gold loan lets you unlock the value of your idle jewellery without selling it. Whether you need funds for a medical emergency, business working capital, or a child's education, use the calculator above to see how much you can borrow against your gold.

Gold Loan Amount by Weight and Purity

Weight (grams)	24K (99.9%)	22K (91.6%)	18K (75%)
10g	₹51,000	₹46,750	₹38,250
20g	₹1,02,000	₹93,500	₹76,500
50g	₹2,55,000	₹2,33,750	₹1,91,250
100g	₹5,10,000	₹4,67,500	₹3,82,500

*At ₹6,800/gram for 22K, 75% LTV. Actual gold rates vary daily.

Gold Loan Repayment Modes Compared

Choose the repayment mode that fits your cash flow:

Feature	Regular EMI	Bullet	Overdraft
Monthly Payment	EMI (P+I)	Interest only	Interest on use
Principal Due	Part of EMI	At maturity	Flexible
Total Interest	Lowest	Moderate	Highest
Best For	Salaried borrowers	Lump sum at maturity	Business owners

Tips for Getting the Best Gold Loan Deal

Compare LTV and Interest Rate Together

Do not look at interest rate alone. A lender offering 10% with 70% LTV may give a smaller loan than one offering 11% with 75% LTV. Compare the final loan amount and total cost.

Choose the Right Repayment Mode

EMI mode is cheapest overall. Bullet mode helps if you need lower monthly outflow. Overdraft is flexible but costs the most — use only for short-term needs.

Check for Hidden Charges

Ask about processing fee (0.5-2%), valuation charges, documentation fees, and prepayment penalty. These add up and affect the effective interest rate.

Prefer Organised Lenders

Banks like SBI, HDFC, and ICICI offer lower rates (7-11%) than NBFCs like Muthoot and Manappuram (12-18%). However, NBFCs may offer faster processing and higher LTV.

Gold Loan vs Personal Loan – Which is Better?

✓ Gold Loan Advantages

• Lower interest rate (7-12%) vs personal loan (12-24%)
• No income proof needed for small amounts
• Flexible repayment modes available
• Quick disbursal, minimal documentation

✗ Gold Loan Disadvantages

• Need to pledge gold jewellery
• Risk of losing gold if default
• Lower loan amount (max 75% LTV)
• Gold rate fluctuation affects renewal

How is Gold Loan Interest Calculated?

In plain words

Gold loan interest depends on the repayment mode you choose. Regular EMI mode works like a standard loan. Bullet repayment has you pay only interest monthly with principal due at maturity. Overdraft gives you flexible withdrawal with interest on the drawn amount.

How the calculation works

Loan Amount = Gold Weight × (Purity ÷ 24) × Gold Rate × (LTV ÷ 100)

For EMI Mode: EMI = [P × R × (1+R)^N] / [(1+R)^N – 1]
For Bullet: Monthly Interest = P × R ÷ 12 (Principal at end)
For Overdraft: Interest on drawn amount only

A quick example

Let us calculate a gold loan against 22K gold jewellery:

Gold Weight:50 grams (22K)

Gold Rate:₹6,800 per gram (22K)

LTV Ratio:75% (RBI max)

Interest Rate:11% p.a.

Tenure:12 months (EMI mode)

Step by step

1.Pure gold = 50 × (22 ÷ 24) = 45.83 grams
2.Gold value = 45.83 × ₹6,800 = ₹3,11,667
3.Loan amount = ₹3,11,667 × 75% = ₹2,33,750
4.Monthly EMI at 11% for 12 months = ₹20,633
5.Total repayment = ₹2,47,596
6.Total interest = ₹13,846

So the answer is: Loan Amount: ₹2,33,750 | Monthly EMI: ₹20,633 | Total Interest: ₹13,846

Frequently Asked Questions on Gold Loans

What is the maximum LTV for a gold loan?

As per RBI guidelines, the maximum LTV (Loan-to-Value) ratio for gold loans is 75% of the gold value. However, some NBFCs may offer up to 90% LTV on certain schemes. Higher LTV means a larger loan but also higher interest cost.

Which is better — EMI, bullet, or overdraft for gold loan?

EMI mode is best if you want to pay off gradually with fixed monthly payments. Bullet repayment suits borrowers expecting a lump sum at maturity. Overdraft is ideal for businessmen who need flexible access to funds with interest only on the drawn amount.

How is gold purity checked for loans?

Banks and NBFCs test gold purity using touchstone, acid test, or electronic karat meter. Common purities are 24K (99.9%), 22K (91.6%), and 18K (75%). Loan amount is calculated on the pure gold content after adjusting for purity.

What happens if I default on a gold loan?

If you default, the lender will auction your gold after giving a notice period (usually 30 days). Any surplus above the outstanding amount is returned to you. Defaulting also negatively impacts your CIBIL score and future loan eligibility.

Can I get a gold loan without income proof?

Yes, gold loans are one of the few loans that do not require income proof for smaller amounts (up to ₹2-3 lakh). The gold itself serves as collateral. For larger amounts, lenders may ask for basic KYC and income documents.