Current jewel loan interest rates in India
Bajaj Finserv Gold Loan offers one of the most competitive jewel loan interest rates in the market, making it a practical option for individuals looking to get funds against gold jewellery, without selling it. The jewel loan interest rate at Bajaj Finance starts from 9.50% to 24% p.a., depending on the loan amount, tenure, and your profile. This affordable rate structure helps you manage urgent financial needs, whether it is for medical expenses, education, or personal needs.
With Bajaj Finance, you can also enjoy multiple repayment options like monthly, quarterly, half-yearly, or annual payments, offering great convenience. The company follows the Reserve Bank of India (RBI) guidelines and offers a maximum loan-to-value (LTV) ratio of up to 75%, ensuring you get the highest possible loan against your gold jewellery. Here is a list of charges applicable on a gold loan by Bajaj Finance:
Types of fee
|
Applicable charges
|
Interest rate
|
9.50% p.a. to 24% p.a.
|
Processing fees
|
0.15% (inclusive of applicable taxes)
|
Stamp duty (as per respective state)
|
Payable as per state laws and deducted upfront from loan amount
|
Cash handling charges
|
Rs. 50 (inclusive of applicable taxes) applicable for cash disbursement only.
|
Penal interest
|
Rs. 8 p.a. on outstanding balance
The penal interest margin/rate will be over and above the interest rate slab. This shall be applicable/chargeable in case of default in repayment of the outstanding dues.
|
Part-prepayment charges
|
NIL
|
Foreclosure charges
|
NIL
|
Factors that influence jewel loan interest rates
- Market conditions: Keep an eye on the latest market trends, as gold loan interest rates are influenced by economic factors, inflation rates, and the existing demand and supply for gold. This can give you an idea of the general interest rate environment.
- Loan-to-value (LTV) ratio: The LTV ratio is a key factor for lenders in determining the maximum loan amount they can provide, which is based on the value of the gold jewellery you use as collateral. With Bajaj Finance, you can receive a loan amount of up to 75% of the market value of your 18-22 karat gold jewellery.
- Loan tenure: The interest rate for your gold loan is also influenced by the duration of the loan. Longer loan tenures may result in higher interest rates compared to shorter ones. It is important to choose a gold loan tenure that aligns with your repayment capacity, while also considering the impact on the interest rate.
To help you easily navigate this process, here are some practical tips on how you can obtain the best interest rates on your loan against gold.
How to calculate interest on a jewel loan
Calculating interest on a jewel loan is essential for understanding the total cost of borrowing. Jewel loans are secured loans where the pledged gold determines the loan amount and interest. The interest is typically calculated using the simple interest formula:
Interest = (Principal × Rate × Time) / 100
Here, the principal is the loan amount, the rate is the interest rate charged annually, and the time is the loan tenure in years. For instance, if you borrow ₹1,00,000 at an annual interest rate of 10% for 6 months, the interest would be ₹5,000:
(1,00,000 × 10 × 0.5) / 100 = ₹5,000
It’s important to know that some lenders may apply monthly interest compounding, which can slightly increase the total repayment amount. Using a gold loan calculator is a convenient way to estimate the interest payable and plan your repayment schedule effectively.
Ensure you check the loan's terms and conditions, including additional fees such as processing charges or prepayment penalties, to have a comprehensive understanding of the total borrowing cost.
Tips to get the best jewel loan interest rate
Getting the best interest rate on a jewel loan can significantly reduce your repayment burden. Here are some practical tips to ensure favourable rates:
- Compare lenders: Research and compare different banks, NBFCs, and financial institutions to find competitive interest rates.
- Leverage your credit score: A high credit score indicates financial responsibility, which can help negotiate better rates.
- Opt for a higher loan-to-value (LTV) ratio: Some lenders offer preferential rates for customers pledging gold with higher purity or value.
- Negotiate terms: Always ask the lender if there’s room for rate negotiation based on your repayment history or existing relationship.
- Choose short tenures: Shorter loan tenures often attract lower interest rates, as lenders face reduced risk.
- Avoid unnecessary add-ons: While optional insurance or services may be offered, they could increase the overall cost.
Lastly, timing your online gold loan application during promotional offers or festive seasons can also secure lower rates. With Bajaj Finance, you can benefit from transparent terms and competitive rates. Always read the fine print and use a gold loan calculator to evaluate the best option.
Jewel loan eligibility and documentation
Eligibility Criteria
- Nationality: Indian
- Age: 21 to 70 years
- Gold purity: 18-22 karat
Documents Required
- Any one of the following:
- Aadhaar card
- Voter ID card
- Passport
- Driving licence
- NREGA job card
- Letter issued by National Population Registration
Though PAN card is not mandatory, it is required for loans exceeding Rs. 5 lakh.
Steps to apply for a jewel loan with affordable interest
To apply for a gold loan, you just have to follow a few simple steps:
- Visit the lender's website and click on 'APPLY' to access the online application form.
- Enter your 10-digit mobile number and click on 'GET OTP' to receive a verification code.
- Submit the OTP to verify your identity.
- Select your state and city to locate the nearest branch.
- Provide your full name and date of birth as per your PAN card.
- Schedule an appointment at the chosen branch.
Once completed, expect a call from the lender's representative to confirm your appointment and guide you through the next steps.