A gold loan is a secured loan where individuals pledge their gold jewelry or coins as collateral to borrow money from banks or financial institutions. The loan amount is based on the value of the gold, and borrowers repay the loan in installments over a set period.
Gold loans offer quick approval, minimal documentation, and lower interest rates compared to unsecured loans. They are a popular option for meeting urgent financial needs. If the borrower defaults, the lender can sell the pledged gold to recover the loan amount.
In India, the requirements for a gold loan include:
