Complete Detail about SBI Gold Loan

sbi gold loan interest rate

State Bank of India (SBI) is the largest public sector bank in India. Along with other types of loans that the bank distributes, it also offers gold loans to its customers. The bank has created a gold loan scheme to help people arrange quick money for their various purposes, such as education, marriage, business expansion, property construction, etc. SBI gold loan interest rate is quite low as compared to other banks that make the people choose this lender. If you want to know more about the SBI gold loan, carry on with your reading task. We are sure that this particular piece will be of great help. 

Eligibility Criteria

The eligibility criteria for availing the benefit of a gold loan from SBI is:

  • The applicant’s age should be above 18 years at the time when he submits the loan application.
  • The maximum age of the applicant should not be more than 70 years.
  • Anyone who has a constant source of income, including bank’s employees and pensioners, can apply for a gold loan.

Amount of loan

The minimum and maximum amount of gold loan that can be acquired from SBI are:

  • Minimum: Rs 20,000
  • Maximum: Rs. 50 Lakhs

Margin -SBI Gold Loan

The margin for SBI gold loan is as follows:

  • Gold Loan: 25%
  • Liquid gold loan: 25%
  • Bullet repayment gold loan: 35%

The Interest rate on the SBI gold loan

SBI gold loan interest rate for various schemes is as follows:

Gold loan (all variants)

  • MCLR – 7.00% (for 1 year)
  • Spread – 0.50%
  • Effective interest rate – 7.50% onwards per annum

Realty gold loan (all variants)

It is only available for the SBI housing loan customers

  • MCLR – 7.00%
  • Spread – 0.30%
  • Effective interest rate – 7.30% onwards per annum

Fees and Charges – SBI Gold Loan

The applicable charges are:

  • The processing fee of the SBI gold loan is 0.25% of the loan amount. Borrowers also have to pay GST over the loan amount, additionally.
  • The processing fee for the minimum loan amount (Rs 20,000) is Rs 500.
  • There is no processing fee in case the applicant is applying through the YONO app.
  • Gold appraisal charges are only shared by the bank at the time of the loan sanctioning process.

Repayment tenure

Based upon the different gold loan schemes, the loan tenure is also different.

  • Gold loan of 36 months
  • Liquid gold loan of 36 months
  • Bullet repayment gold loan of 12 months

Documents required

Here is a list of all the documents required by the State Bank of India for sanctioning gold loans:

  • Duly filled application form
  • 2 passport size photographs
  • Identity proof (anyone)
    • Aadhar card
    • Driving License
    • PAN card
    • Passport
    • Voter ID
  • Address proof (anyone)
    • Any of the above-written identity proof that has a permanent address
    • Electricity bill
    • Telephone bill
    • Post-paid mobile bill
  • Income proof

If the applicant is illiterate, he needs to provide a witness letter

  • Documents required at the time of disbursement
  • Demand Promissory Note
  • Demand Promissory Note
  • Arrangement letter

Loan to Value Ratio – SBI Gold Loan

After calculating the value of the gold which you are pledging to the SBI as collateral, the bank calculates the eligible gold loan amount. It applies the loan to a value ratio of 75%. If you are taking a loan amount lower than the maximum LTV amount, then the bank might offer a lower interest rate. 

Here are a few points that a borrower needs to remember about the SBI gold loan LTV ratio:

  • A margin of 35% will be applied to the total value of the gold.
  • The borrower needs to maintain the LTV ratio of 75% throughout the tenure of the loan.
  • The LTV ratio is calculated against the total amount available in the borrower’s SBI account, the current value of the gold accepted as collateral or security and the accrued interest. 
  • In the case the LTV ratio rises above the stipulated 75% limit due to the fall in gold prices, the borrower will be required to replenish the margin either by depositing more cash or other gold jewellery, ornaments or coins.

How to apply for an SBI gold loan?

The application process for an SBI gold loan is very short and simple and you can do it even online. You just need to follow these instructions:

  • Open the official website of the SBI.
  • Click on the “Apply for Gold Loan”. It will open an application form. 
  • Fill in the details in the application form. It will ask you for your personal information such as Name, Mobile Number, Email ID, Required Loan Amount, Etc.
  • Upload all the required documents.
  • Click on the “Submit” button and your application process will be completed.

The State Bank of India (SBI) provides special offers of gold loans to its customers. Being the largest public sector bank in India, it also offers one of the best interest rates on gold loans so that people can acquire quick money, without any hassle. 

By Smarts Timer

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