A gold loan is a type of secured loan in which you pledge gold jewellery or coins as collateral to borrow money from a bank or non-banking financial company for personal or business needs.
The lender assesses the purity and weight of the pledged gold and sanctions a loan amount based on its market value. In 2026, gold loan interest rates in India range from 8.5% to 24% per annum.
The applicable rate depends not only on the value or purity of the gold but also on several other factors, including the loan tenure, type of lender, loan amount, and repayment structure.
How is the gold loan interest rate calculated?
A gold loan interest rate is the percentage charged by banks or financial institutions against the loan amount provided to the borrower when they pledge their gold assets as collateral.
Borrowers have the option to repay the interest amount, either in monthly instalments or as a lump sum, based on the lender’s terms and conditions.
Generally, banks tend to offer lower rates (closer to 8-12%). whereas NBFCs and private lenders may charge higher rates, sometimes going up to 20-27%, especially for flexible or short-term loans.
Interest rates charged by top Indian banks
Here are the top five banks of India that offer gold loans, along with their interest rates and other key terms and conditions.
— State Bank of India (SBI): It offers a gold loan at 9% per annum onwards, for loan amounts ranging from ₹20,000 to ₹50 lakh. The tenures of SBI gold loans can go up to 3 years (in case of EMI-based option). The borrower can also opt for a tenure of 3 months, 6 months and 12 months in case of loans availed with the bullet repayment option.
— Punjab National Bank (PNB): The bank offers a gold loan at 9.25% per annum for a loan amount of up to ₹25 lakh and for a tenure of up to one year. Borrowers availing PNB’s gold loan have the option to make repayments through the bullet repayment method, EMI-based method and overdraft.
— HDFC Bank: The bank’s Internal Rate of Return for gold loans ranges from 9.10% to 19% per annum. Loan amounts start at ₹25,000, with tenures spanning 6 to 42 months. It also offers up to 75% of the gold’s market value.
— ICICI Bank: The bank’s gold loan interest rates range from 8.75% to 16.75% per annum (as of late 2025), with tenures spanning 6 to 36 months. An applicant can avail a loan worth up to ₹2 crore if they fulfil certain terms and conditions.
— Bank of India (BOI): The bankoffers a gold loan at 8.85% per annum onwards and for a loan amount of up to ₹30 lakh, with tenures ranging from a few months to up to 36 months. It also offers up to 85% of the gold’s market value.
Interest rates charged by NBFCs in India
Here are the top three NBFCs of India that offer gold loans, along with their interest rates and other key terms and conditions.
— Muthoot Finance: The NBFC offers gold loans at 10.90% per annum onwards for loan amounts up to ₹1 crore and for tenures of up to 1 year. Applicants can avail Muthoot Finance gold loans by pledging their gold jewellery or coins of 22 carats to 24 carats purity.
— Manappuram Finance: It offers gold loans at 9.90% per annum onwards for loan amounts of up to ₹1.5 crore and tenures of up to 1 year with no-end usage restrictions. The applicant can receive up to 75% of the value of gold pledged as collateral.
— Bajaj Finserv: The NBFC offers a gold loan at an interest rate between 9.5% and 24% per annum onwards for a loan amount of up to ₹2 crore. Applicants can avail the company’s gold loans by pledging their gold jewellery of 22 carats to 24 carats purity.
Eligibility for taking a gold loan
The eligibility criteria to take a gold loan vary from lender to lender. Hence, people are advised to check the criteria mentioned on the lender’s website before applying for a gold loan.
Here are some common eligibility criteria that are set by most lenders in India for gold loans:
— The applicant should be 18 years of age or above.
— They must pledge gold ornaments or articles as security against the loan.
— The owner must legally own the gold item that they are pledging.
— They must be an Indian resident.
— The applicant should pledge gold of 18 carats or above as security. Gold biscuits/bars may have restrictions depending on the lender.
