In the current gold rush scenario, where the price of gold has soared to a record high of Rs 66,000 per 10 grams due to weak US economic data, individuals are exploring the option of gold loans as a viable financial solution. Gold loans are secured loans offered by banks against the pledge of gold assets, providing borrowers with immediate liquidity while keeping their gold holdings intact. Among the plethora of banks offering gold loans, some stand out for offering the lowest interest rates, making them appealing choices for borrowers.
Here is a rundown of banks offering the lowest interest rates on gold loans:
- HDFC Bank: With an interest rate of 8.5 percent per annum, HDFC Bank leads the pack in providing cost-effective gold loans. For a Rs 5 lakh gold loan with a tenure of two years, the monthly installment (EMI) would be Rs 22,568.
- Indian Bank: Following closely, Indian Bank offers a competitive interest rate of 8.65 percent on gold loans, translating to an EMI of Rs 22,599 for a similar loan amount and tenure.
- Union Bank of India: Offering an interest rate of 8.7 percent, Union Bank of India provides borrowers with affordable gold loan options. The EMI for a Rs 5 lakh gold loan with a two-year tenure would be Rs 22,610.
- Bank of India: With an interest rate of 8.8 percent, Bank of India is another favorable choice for borrowers seeking low-cost gold loans. The EMI for a Rs 5 lakh loan over two years would amount to Rs 22,631.
- Canara Bank and Punjab National Bank: These banks levy an interest rate of 9.25 percent on Rs 5 lakh gold loans with two-year tenures, resulting in EMIs of Rs 22,725.
- Bank of Baroda: Offering an interest rate of 9.4 percent, Bank of Baroda provides borrowers with competitive gold loan options. The EMI for a Rs 5 lakh loan over two years would be Rs 22,756.
- State Bank of India (SBI): As a public sector behemoth, SBI offers an interest rate of 9.6 percent on Rs 5 lakh gold loans with two-year tenures, translating to an EMI of Rs 22,798.
- ICICI Bank: Charging an interest rate of 10 percent, ICICI Bank offers gold loans with manageable EMIs. The EMI for a Rs 5 lakh loan over two years would be Rs 22,882.
- Axis Bank: While still competitive, Axis Bank levies a relatively higher interest rate of 17 percent on gold loans, resulting in an EMI of Rs 24,376 for a Rs 5 lakh loan with a two-year tenure.
It’s important to note that the top 10 banks by secured loans have been considered for this list, and the data is based on information available as of March 12, 2024. Borrowers should carefully review the terms and conditions offered by each bank before availing of a gold loan to make an informed financial decision.
