Important SBI Gold Loan Prerequisites You Must Know
The State Bank of India or SBI offers between Rs. 20,000 and Rs. 20 lakhs as the gold loan to existing customers. In rural areas, the minimum loan amount starts from Rs. 10,000. The SBI gold loan can fulfill any requirement, as there are no restrictions on the end-purpose of the loan, other than a prohibition on the funds being used for any illegal acts and speculative purposes. There are special gold loan offers and rates for women customers and farmers/agriculturists.
So if an individual has gold jewellery or gold coins purchased from a reputed bank, but lying idle in locker or home, then he/she can utilize these to get funds. The gold assets can be pledged in SBI to get a loan to solve cash shortage. The money from the loan can be utilized for personal expenses such as building a property, marriage, big-ticket purchase, travel and medical treatment, education, etc.
Below given are some of the important features of State Bank gold loan.
SBI Gold Loan Features
|Interest Rate||11.15% (2% + 1 year. MCLR)
Currently, the bank charges interest rate on a loan against gold that is 2 percent above the 1 year MCLR (9.15% per year).
|Minimum Loan Amount||Rupees 20,000|
|Max. Loan Amount||Rupees. 20 Lakhs|
|Gold Loan Margin||Up to 25% minimum for the standard loan against the gold scheme.
Up to 35% for gold loan on bullet repayment scheme.
|Maximum Repayment Tenure||30 months for the standard gold loan.
36 months for overdraft scheme.
|Processing Fees on Bank Gold Coins and Hallmarked Gold Jewellery||0.50% of approved and disbursed loan amount, with tax applicable separately.|
|Processing Fees for Non-Hallmarked Jewellery||Rs. 250 + tax for loan amount below Rs. 25,000.
Rs. 500 + tax + 0.5% of sanctioned loan amount, if the amount is more than Rs. 25,000.
Benefits of Gold Loan by State Bank of India
Below given are the advantages of loans against gold by SBI.
- Security for Gold: The gold asset one keeps as security with SBI receives complete protection against damages, theft, and other adversities. The asset is kept in the strong vault and receives 100 percent security and CCTV surveillance.
- High Loan Amount: According to the amount and quality of the gold pledged, one can receive up to Rs. 20 lakhs as loan. The bank does not accept gold below 18 carats.
- Transparent Charges and Policies: SBI does not charge a very high fee to process the gold loan. It is a pocket-friendly financing option for everyone. Any penalties on late payment are disclosed to the customer beforehand. There are no prepayment charges applicable.
- Quick Approval and Disbursal: The bank can disburse the funds in just a few hours or the same-day after the gold evaluation is completed and the loan application form, with documents, are in order.
- Flexible Repayment: A loan against gold from State Bank of India can be repaid in EMIs up to 36 months. Bullet repayment scheme may be available on request, where the interest component is first to be paid through the tenure, at the end of which the principal amount has to be repaid.
Eligibility Criteria for State Bank Gold Loan
Those who wish to apply for the gold loan at SBI need to meet a few basic criteria to qualify for the loan.
- Collateral: A loan against gold can be attained only when the customer pledges gold with the bank. The gold asset must be owned by the probable borrower. Gold plated ornaments are not considered for the loan.
- Type of Gold: The person who wishes to take a gold loan can get the loan only against 50 grams of gold coins and gold jewellery (minimum 15 grams). Any other material in the ornament cannot be taken to account for the loan amount calculation.
- Age: The borrower must be over 18 years of age to qualify for the scheme.
- Existing Customer: The applicant has to be an existing customer of the bank. He/she must have maintained some banking transactions in the past with SBI.
- Income: The applicant should have a regular income and employed in any profession, with capacity to repay the loan. But, in gold loan, the borrower does not have to specifically submit a proof of income.
Documents for State Bank of India Loan against Gold
Below provided is a list of documents needed for SBI loan against gold.
- Photographs: Two recent passport-size photographs of the applicant.
- Identity Proof: A Pan Card and Aadhar Card is mandatory.
- Address Proof: Government approved, valid address proof any of the following: Passport, utility bill, Aadhar card etc.
- Form: Gold loan application form should be duly filled, signed, and submitted.
SBI Gold Loan Fees and Charges
The State Bank of India, unlike other banks, charges only a nominal fee for processing the loan application. The amount of this fee depends on the quality of gold pledged as collateral. Maximum charge is Rs. 500 along with GST applicable. There could be late payment fee applicable if the EMIs have been overdue for quite a time. The gold ornaments can be auctioned off in case the borrower fails to repay the loan even after constant intimations and reminders.
The above-given information will help a person understand SBI loan against the gold scheme and its prerequisites. Study these well before applying for a gold loan with this bank.