If you closely follow the Indian economy, you will understand the unique culture we have, the concept of wealth, and the effect of gold loans. When you have gold, you can get loans easily by attaching the gold as security.
In this blog, we will talk about the increasing popularity of gold loans in India, what are the reasons behind choosing a gold loan, the difference between other loans and gold loans, along many. Check the DSA partner app so that you can learn about popular loan options and find the best one.
What is the Role of Gold Loans in the Indian Economy?
According to data, Gold loans are popular worldwide. Indians especially have a fascination with gold. It is a way to show your status and have some security at home. Banks and finance companies offer loans if you attach your gold items as security. People who want liquid money fast should get a gold loan immediately. Here are some of the important aspects of Gold loans in our economy-
- As we know, Gold loans are available only for people with collateral, so the chances of default are low. Banks don’t need to fear about NPA for this particular loan option.
- Use of Gold loans has made it possible to get loans to those people who don’t have any credit history. Bringing them all under the banking system is a success for sure.
- Small business enterprises can get much-needed support using the gold loan feature. Getting investment will be easy for you.
- Liquidity is another important reason for boosting the Gold loan facility.
Learn About A Few Popular Gold Loan Options in This Country
In India, a number of gold loan options are there that can help you have the money you need whenever you want. Let’s talk about them to understand the options available in the market.
- We all have heard about Muthoot Gold loan finance. In comparison to other loans, it is much easier to have and get money with a low interest rate of 6.9% per annum.
- HDFC also offers a gold loan option where you can take up to 1 crore as a loan based on the amount of gold you have. The rate of interest is a little high.
- Manappuram gold loan could be another option you can have. The minimum amount is 1000; you can take over that. It is important to understand the processing method and features before having the same.
Apart from what we have shared, there are other loan options you can have in the market. They are all effective and offer great facilities. Consulting with an expert will help you choose the right gold loan option and learn about DSA full form.
What Makes Gold Loans Different Than Other Loans?
Gold loan is not like any other normal loan. Learn about a few aspects where this particular loan is different than other loan options-
- As we have already told you, gold loans are secured loans. Unlike other loan options, these are safe for both the banks and borrowers.
- Loan disbursal time is low for gold loans. In any other loan, it might take some time to get the money, as the gold loan is totally secured, you will have approval almost immediately.
- The rate of interest for most home loans is lower than usual loans in the market. Other loans offer greater interest rates on their debt facility.
- Flexibility for gold loans is much better than usual loans.
- In any other loan, your credit score is hugely important. Gold loans don’t check credit scores that much.
- Repayment options are simple and effective.
Tips that Might Help You
- It is necessary to compare different gold loan options and check a few important aspects before finalizing the loan.
- Loan to loan-to-value ratio is different for different loans. RBI imposes strict rules on that value. Loan companies need to maintain a minimum of 75% while lending a loan.
- Processing fees for different loans are different. Pick the one that you think is more effective.
- Understand repayment facilities that you can afford.
- Talk to a customer care person to understand more about these loan options.
Try to follow these tips before using the best loan.
