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Gold Loan in Brief

A financing mechanism whereby gold is borrowed from a bullion bank (which has usually borrowed it from a central bank or banks), and sold into the market to raise cash, usually to finance a gold mining operation. The metal is then repaid over an agreed period of time.


Many go for this loan for short period to meet the requirement of their children’s education, marriage and other financial problems in the family. And others think that instead of keeping the gold idle at home or locker, loan against gold is the best option. Moreover with the rise in gold rates the demand from companies, Banks and Nidhi's offering such loans has raised.


Gold loan doesn’t demand any certificate to show your salary or income and even no credit card history is required. Thus even unemployed and non working people can go for gold loan.

Unlike any other unsecured loan, gold loan doesn’t require many papers, only few documents such as ID proof and address proof is enough to avail for such loan.

One of the main advantages of gold loan is its low interest rates. Usually loan over gold is provided at the interest of 12-16% per annum and this is quite low compared to personal loans available at interest rates of 15-26% per annum.

Gold loan is the most simple and convenient forms of loan because here all you need to do is pledge your gold with a bank or finance company (Nidhi) and get up-to 80% of the market value and purity of the gold as a loan.

Borrower will be given an option to pay only interest during the entire term and at the end of the tenure you can pay complete borrowed amount in single shot, or as Nidhi provide options for pay your princpal amount and interest both.


Identity proof such as Aadhar Card, passport, voters ID or driving license,

Address proof such as electricity bill, ration card, telephone bill etc,

For signature proof you need to submit your passport copy, driving license or any other document with your sign and

2 passport size photographs.