Gold Loan Interest Rate in Bangladesh 2023 | Bank Compare
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Gold loans are secured loans where gold jewelry is used as collateral. You pledge your gold jewelery to your lender and get a loan. The loan amount is usually a percentage of the value of the gold. You can repay the loan in monthly installments.
After payment, you will get your gold jewelry back. State-owned banks, private banks, and other financial institutions offer these loans at affordable interest rates. Generally, borrowers use this loan to meet sudden financial needs like marriage or child’s education. Instead of selling gold, many individuals opt for a loan option.
You take your gold jewelry to a lender and ask for a loan by pledging it. The lender evaluates the gold and approves the loan after verifying the documents. Some gold loan lenders even appraise your gold jewelry at home. The process is quick and usually takes a day.
For a gold loan, you need to submit identity proof like driving license, PAN, passport or Aadhaar card. If you don’t have PAN, you may be asked to submit Form 60. As proof of address, you need to submit an electric bill, ration card or telephone bill. You will also need to submit a signature proof like passport copy, driving license or any other document.
Along with these, you also need to provide a passport size photograph. Some lenders may also ask for proof of your income.
Gold Loan Interest Rate in Bangladesh
Since gold loans are secured loans, the interest rates are slightly lower than unsecured loans like personal loans. Non-banking financial companies (NBFCs) may charge higher interest rates than banks. Hence, it is advisable to compare various interest rates before taking a gold loan. This is a personal loan, with an interest rate of 12.75% or higher, although it varies between different lenders.
When you apply for a loan, the lender may charge a processing fee of up to 1% of the loan amount. You may also be charged for documentation. Fees may also apply for gold valuation. Lenders may charge a renewal fee based on the loan amount, and stamp duty as per state laws. You may have to pay late fees for late payments.
Depending on whether you decide to repay the loan, your lender may charge you service tax (or GST) and prepayment/early closing fees. The actual amount of the charge may vary from one lender to another. So, don’t forget to compare them as well. Anyone who owns gold jewelery can avail a gold loan. He may be a salaried person or a homemaker and farmer.
Gold loan tenure is usually short and it is usually between 3-12 months. However, some lenders offer relatively longer terms. Other lenders allow you to renew and extend your loan. Since the tenure is short, you must be sure that you can repay the loan on time. If you fail to repay the loan within the term, you may lose the mortgaged gold or the lender may sell it at auction to recover the loan amount.
Gold Loan Interest Rate in Bangladesh
Lenders assess the purity of gold and its weight before confirming the loan amount. Based on the purity and weight of the gold, the gold appraiser determines the market price. Lenders offer loans up to 75% of market value. This is called ‘loan to value ratio/LTV’.
The method of storing gold jewelry may differ from lender to lender, but proper measures are taken to properly store gold jewelry. After the loan is sanctioned and disbursed, the gold is kept under strict security.
Lenders use electronic vaults with motion detectors and CCTV for security. Some lenders even insure your mortgaged gold. This protects the gold from being stolen. In case of a robbery, you will get a refund equal to the market value of the gold.
Depending on your lender, you may have flexible repayment options. Most lenders offer you the option of paying only the interest portion every month. In such cases, the principal loan amount is repaid at the end of the loan tenure. You can also choose to pay EMIs to repay the loan.
Gold Loan Interest Rate Bank Compare
| Bank Name | Maximum Loan | Tenure | Interest Rate |
|---|---|---|---|
| Prime Bank | 5 Lack | 12 Month | 9% |
Some Frequently Asked Questions (FAQ)
- Loan against Gold is a secured overdraft (SOD) facility by pledging Gold Jewelries/ornaments
- Any female customer ages between 18 to 65 years and owns Gold jewelries/ornaments.
- Gold jewelries/ornaments of purity 18 Carat & above.
- Loan can be offered against Gold Jewelries/ornaments owned by immediate family members subject to submission of ownership & relationship proof documents.
- Loan against Gold bar, Gold coin, bullion/primary Gold Gold-plated metals and other ornaments made of diamond, silver, cadmium etc. will not be accepted.
- Maximum 50% of the market value of pure Gold.
- Minimum limit is BDT 1,00,000 and maximum limit is BDT 5,00,000 or up to 50% of LTGV (whichever is lower).
- Portion of pure Gold is determined by excluding weight of stones, gems, khad and other metals from the gross weight.
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