Loan Against Gold - Get Instant Funds on Your Gold

All you need to know about borrowing against your gold jewellery.
Loan Against Gold - Get Instant Funds on Your Gold
2 min read
14 April 2025

In times of financial need, a lending against gold can provide a valuable lifeline. It allows you to leverage the value of your gold jewellery to secure a loan. Whether you are looking to meet a personal expense, start a business, or manage an emergency, understanding how to apply for a loan against gold can be the key to unlocking the funds you require. Read to know what a loan against gold is, its benefits, and how to apply for one.

What is a loan against gold?

A loan against gold, also known as a gold loan or gold-backed loan, is a type of secured loan where you pledge your 18 karat gold jewellery as collateral to obtain funds from a financial institution or lender. The loan amount you receive can go up to a maximum of 75% of the gold's market value, known as the loan-to-value (LTV) ratio.

The primary advantage of a loan against gold is that it allows you to access quick funds without selling your precious assets. Gold is widely accepted as collateral due to its inherent value and global market liquidity. You can get a gold loan at lower interest rates compared to unsecured loans because the gold jewellery acts as security.

Why choose lending against gold?

Lending against gold is a practical and quick solution when you need urgent funds. With minimal documentation and no need for income proof, gold loans offer a hassle-free way to access cash by pledging your gold jewellery. Since the loan is secured, the approval process is faster, and the interest rates are usually lower compared to unsecured loans.

Gold remains safe with the lender, and you retain ownership while using its value for your financial needs. Whether it is for education, medical emergencies, or personal expenses, gold loans provide financial flexibility. Bajaj Finserv Gold Loan ensures a transparent evaluation process, secure storage, and multiple repayment options, making it a reliable choice for many borrowers.

Eligibility criteria for gold loan

To apply for a gold loan, you must meet specific eligibility criteria. Bajaj Finance ensures a simple process so that you can access funds easily by pledging your gold jewellery. The basic eligibility criteria for gold loan include:

  • Applicant must be an Indian citizen
  • Age must be between 21 and 70 years
  • You must own gold jewellery of 18-22 karat purity

For detailed information, visit the eligibility criteria for gold loan page. Meeting these requirements ensures a quick and smooth loan approval process.

Documents required for applying for a gold loan

When applying for a Bajaj Finserv Gold Loan, only a few essential documents are needed, making the process quick and convenient.

These documents help verify your identity and ensure regulatory compliance. The documents include:

  • Aadhaar card
  • Voter ID card
  • Passport
  • Driving licence
  • NREGA job card
  • Letter issued by National Population Registration

*PAN card is not required. However, if you apply for a gold loan of Rs. 5 lakh or above you will be asked to submit your PAN card.

In most cases, no income proof or credit score check is required. The simplicity of this documentation process, along with the security of your pledged gold, makes applying for a gold loan both convenient and efficient.

How to apply for a loan against gold

You can initiate the process by assessing the value of the jewellery you intend to offer as collateral. You can use the free Bajaj Finance online gold loan calculator. By entering either the weight of your gold in grams or the desired loan amount, the calculator will provide an estimate of your loan liability.

The advantage of gold loans is that they eliminate the need for extensive and time-consuming paperwork, as your gold jewellery acts as collateral. Any Indian citizen aged between 21 to 70 years can apply for a gold loan. You will only be required to present one of your KYC documents for gold loan, such as an Aadhaar Card, voter ID card, driving licence, or passport, to avail a Bajaj Finance Gold Loan.

Leverage the underlying value of your unused gold jewellery to meet your immediate funding requirements. Follow a few simple steps to ensure a quick disbursement of your gold loan.

  • Step 1: Visit the Gold Loan section of the website
  • Step 2: Click on the online application form
  • Step 3: Enter your 10-digit mobile number and click on ‘GET OTP’
  • Step 4: Enter OTP to verify your details
  • Step 5: Select your state and city to locate your nearest branch
  • Step 6: Enter your full name and date of birth as per your PAN
  • Step 7: Set up your appointment at the nearest branch in your city

You can enjoy the convenience of selecting a time that suits you best and visiting our branch with your 18 gold jewellery. Our team will evaluate the purity of your gold jewellery and initiate the loan application process. With a vast network of over 800 branches nationwide, we are committed to processing your loan application swiftly and efficiently, ensuring a seamless and trouble-free experience for you.

How is the loan amount determined?

The loan amount offered under a gold loan depends mainly on the purity and net weight of your gold jewellery. Bajaj Finance evaluates your gold based on the market value, purity, and the prevailing gold rate. The purer and heavier the jewellery, the higher the value you can receive.

Another important aspect is the Loan-to-Value (LTV) ratio, which is regulated by the Reserve Bank of India and usually capped at 75% of the gold’s market value.

For instance, if the gold rate is favourable, you may be able to avail a higher loan for the same jewellery compared to periods when gold prices are low. To estimate how much you can borrow, you can use the Bajaj Finserv Gold Loan calculator. With the tool, you can get quick evaluation and transparent procedures for determining your loan eligibility.

Factors affecting gold loan approval

Gold loan approval is relatively simple, but certain factors still influence the process. One of the most significant is the purity of gold. Most financial institutions accept jewellery ranging from 18K to 24K purity, with higher purity fetching better valuation. Weight of the gold also matters, as it directly affects the loan amount you can receive.

Another factor is the Loan-to-Value (LTV) ratio, which is governed by RBI guidelines. The lender will only sanction up to a certain percentage of the market value of your gold. Proper documentation, such as Aadhaar and PAN cards, is essential to meet Know Your Customer (KYC) requirements.

While a high credit score is not mandatory, previous repayment behaviour may still be reviewed. Applicants with a clean financial history tend to receive quicker approvals. These factors together decide how much you can borrow and how swiftly your gold loan is processed.

Gold loan interest rates and tenure

The interest rates and repayment tenure for gold loans are two crucial elements that affect your borrowing experience. Gold loan interest rates are typically lower than unsecured personal loans because the loan is secured against your gold jewellery.

Bajaj Finance offers competitive rates, making it an affordable option during financial emergencies. In terms of tenure, most gold loans come with multiple repayment options. You can choose to pay the interest monthly, quarterly, half-yearly, or even annually.

There is also an option to pay only the interest during the loan term and the principal at maturity.

This flexibility makes gold loans attractive for individuals looking for short-term funds. To explore the latest options and to check if you qualify for a gold loan at lower interest rates, you can check your loan eligibility on our App or website.

Disclaimer

1. Bajaj Finance Limited (“BFL”) is a Non-Banking Finance Company (NBFC) and Prepaid Payment Instrument Issuer offering financial services viz., loans, deposits, Bajaj Pay Wallet, Bajaj Pay UPI, bill payments and third-party wealth management products. The details mentioned in the respective product/ service document shall prevail in case of any inconsistency with respect to the information referring to BFL products and services on this page.

2. All other information, such as, the images, facts, statistics etc. (“information”) that are in addition to the details mentioned in the BFL’s product/ service document and which are being displayed on this page only depicts the summary of the information sourced from the public domain. The said information is neither owned by BFL nor it is to the exclusive knowledge of BFL. There may be inadvertent inaccuracies or typographical errors or delays in updating the said information. Hence, users are advised to independently exercise diligence by verifying complete information, including by consulting experts, if any. Users shall be the sole owner of the decision taken, if any, about suitability of the same.

Frequently asked questions

What is a loan against gold?

A loan against gold is a secured loan where you pledge your gold jewellery to get instant funds. With Bajaj Finserv Gold Loan, your gold is evaluated, and a loan is provided based on its weight and purity. It is ideal for meeting personal or emergency financial needs.

Who can apply for a gold loan?

Any Indian citizen between 21 and 70 years of age can apply for a Bajaj Finserv Gold Loan. You must own 18-22 karat gold jewellery and provide basic KYC documents for verification during the application process.

What is the interest rate for gold loans?

Bajaj Finance offers competitive interest rates on gold loans, starting from as low as 9.50% up to 26% per annum. The interest rate depends on the loan amount, tenure, and prevailing gold value. There are multiple repayment options to suit different financial needs.

Can I renew a gold loan after the term ends?

Yes, Bajaj Finance allows easy renewal of your gold loan once the original tenure ends. You can re-pledge the same gold ornaments, and the lender will re-evaluate them as per the current market rate before sanctioning a new loan.

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