What are the 3 different types of Gold Loans in India?

Gold Loan types offer a practical and convenient solution for urgent financial needs, allowing you to use your gold jewellery, ornaments or coins as collateral. These secured loans stand out for their fast approval, minimal documentation and competitive interest rates, providing a reliable source of funds without sacrificing the sentimental value of your precious belongings. It is crucial to understand the types of Gold Loans available to choose the one that best fits your unique situation and requirements. By familiarising yourself with the different types of Gold Loans, you can equip yourself with flexible and quick liquidity solutions, helping you effectively manage financial emergencies. Discover the right Gold Loan type to meet your needs today.

Different types of Gold Loans

Gold Loan against jewellery

This popular Gold Loan type allows you to secure a loan against your gold ornaments or coins. The loan amount depends on the gold's purity and the current market value. This loan option offers relatively lower interest rates compared to unsecured loans.

Axis Bank Gold Loan: Axis Bank offers rapid loan processing and disbursement within 60 minutes, providing a prompt financial resolution when necessary. You can avail of a Gold Loan up to ₹40 lakh at competitive interest rates and flexible repayment tenures.

Gold Loan for farmers

This specialised Gold Loan type caters to farmers' financial needs. The loan funds can be used for crop-related expenses, agricultural equipment or other farming requirements. Farmers can leverage their gold holdings to secure funds for crop cultivation or purchasing seeds / fertilisers. These specialised Gold Loans often feature lower interest rates and repayment schedules customised to crop cycles and harvest seasons, reducing financial strain for farmers.

Axis Bank Agricultural Gold Loan: A type of overdraft facility for amounts ranging between ₹25,001 and ₹40,00,000, this loan provides instant liquidity against gold and easy repayments aligned with harvest cycles.

Gold Overdraft

A gold overdraft facility provides ongoing and convenient access to funds by using your gold as collateral. It functions like a credit line, granting you a pre-approved limit from which you can withdraw money as needed. You'll only pay interest on the amount you use, providing flexibility and potential cost savings.

This facility is ideal for managing unexpected expenses, recurring or unexpected financial needs and planned purchases. With a gold overdraft facility, you can access liquidity when needed without selling your gold assets.

Also Read: Understanding the difference: Gold Loan vs Personal Loan for the right choice

Conclusion

Understanding the types of Gold Loan options available can significantly enhance your financial strategy. Whether securing a loan against jewellery for personal emergencies, obtaining lower-interest loans for agricultural projects, or managing cash flow through an Overdraft facility, Gold Loans offer tailored solutions for diverse needs. Evaluate your specific financial circumstances and the purpose for which funds are required to make an informed choice. Exploring products like Axis Bank's Gold Loan and Agricultural Business Gold Loan can provide you with competitive advantages such as lower interest rates and flexible repayment options.

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.