Gold loan gets cheaper as SBI cuts interest rates - here's how to apply

If you are planning to buy gold loan, here's some good news for you. Country's largest public-sector lender State Bank of India (SBI) has slashed the interest rates on personal gold loans.

The interest rates, which were 7.75% earlier, has now been reduced to 7.5% annually. A customer can avail a loan of up to Rs 50 lakh by pledging gold articles under the scheme.

The new interest rates are valid till September 30.

Along with reducing interest rates, SBI has also slashed the processing fees of gold loans. SBI is now charging 0.25% + GST of the bank loan amount as the processing fee, which is a minimum of Rs 250 + GST. However,, no processing fees will be charged from those who apply through the YONO app.

A customer can get a loan up to 90% of the value of gold from the bank.

Notably, the Reserve Bank of India (RBI) last month increased the value of the loan on gold jewellery. Now, gold jewellery can be used to get loans up to 90 per cent of its value till March 2021, which was earlier up to 75 per cent. The customer has to repay the loan taken on gold in 36 months. The minimum loan amount is 20 thousand rupees and a maximum of 50 lakh rupees.

Any person above 18 years of age can apply for a gold loan from SBI but only if there is a stable source of income, like a job or a business. However, income certificate is not necessary for this.