Advanced Gold Loan Calculator
Calculate loan eligibility, EMI, and interest with comprehensive features for accurate gold loan planning
What is a Gold Loan?
A gold loan is a secured loan where borrowers pledge their gold ornaments, jewelry, or coins as collateral to obtain quick funds from banks or Non-Banking Financial Companies (NBFCs). It's one of the fastest and most accessible credit options in India, requiring minimal documentation and no credit score checks.
The loan amount depends on the weight, purity, and current market value of the pledged gold. As per Reserve Bank of India (RBI) guidelines, lenders can provide up to 75% of the gold's market value as loan (LTV ratio). The pledged gold remains safely secured in bank lockers and is returned upon full loan repayment.
Key Features of Gold Loans:
- Quick Disbursal - Funds within 30 minutes to 24 hours
- Minimal Documentation - Just ID and address proof
- No Credit Score Required - Secured by gold collateral
- Flexible Repayment - EMI, bullet, or interest-only options
- High Loan Amount - Up to ₹1.5 crore or more
- Competitive Interest - 8% to 24% per annum
- No Income Proof - Based on gold value only
- Safe Storage - Gold kept in secure bank lockers
- Renewable Loans - Extend tenure by paying interest
- Part Payment Allowed - Release gold proportionately
💰 Gold Loan Calculator
📿 Gold Details
💳 Loan Details
📈 Gold Loan Interest Rates 2025
Rates as of October 2025 and subject to change. Check with lender for current rates.
📐 Gold Loan Calculation Formulas
1. Gold Value Calculation
\[ \text{Gold Value} = \text{Weight (grams)} \times \text{Rate per gram} \times \frac{\text{Purity}}{24} \]
Example: For 50 grams of 22K gold at ₹6,500/gram: Value = 50 × 6,500 × (22/24) = ₹2,97,917
2. Loan Amount Formula
\[ \text{Loan Amount} = \text{Gold Value} \times \frac{\text{LTV Ratio}}{100} \]
Example: If gold value is ₹2,97,917 and LTV is 75%: Loan = ₹2,97,917 × 0.75 = ₹2,23,438
3. Simple Interest Formula
\[ \text{Interest} = \frac{P \times R \times T}{100} \]
Where: P = Principal Amount, R = Rate of Interest (% p.a.), T = Time (in years)
Example: ₹1,00,000 at 10% for 1 year: Interest = (1,00,000 × 10 × 1) / 100 = ₹10,000
4. EMI Calculation Formula
\[ \text{EMI} = \frac{P \times R \times (1+R)^N}{(1+R)^N - 1} \]
Where: P = Principal, R = Monthly interest rate (Annual rate / 12 / 100), N = Number of months
Example: ₹1,00,000 at 12% p.a. for 12 months: EMI = ₹8,885
📝 How to Use This Calculator
Enter Gold Weight
Input the total weight of your gold ornaments in grams. Weigh all items you plan to pledge together.
Select Purity
Choose gold purity: 18K (75%), 22K (91.67%), or 24K (99.9%). Most jewelry is 22K in India.
Update Gold Rate
Enter current market rate per gram. Check today's gold price before calculating for accurate results.
Adjust LTV Ratio
Slide to set 60-75% LTV. Higher LTV means more loan but check your lender's maximum limit.
Set Interest & Tenure
Enter lender's interest rate and choose repayment period. Shorter tenure reduces total interest cost.
Calculate & Review
Click Calculate to see loan amount, EMI, interest, and total repayment. Compare different scenarios.
⚙️ How This Calculator Works (Methodology)
This advanced gold loan calculator uses industry-standard formulas and RBI guidelines to provide accurate loan estimates. The calculation process follows these precise steps:
Step 1: Gold Value Assessment
First, the calculator determines your gold's current market value by multiplying weight, current rate per gram, and purity factor. The purity factor converts karats to actual gold percentage (22K = 22/24 = 91.67%). This gives the total market value of your pledged gold.
Step 2: LTV Application
The Loan-to-Value ratio is applied to the gold value. As per RBI guidelines, maximum LTV is 75%. The calculator multiplies gold value by your selected LTV percentage to determine the eligible loan amount. This is the principal amount you can borrow.
Step 3: Interest Calculation
Based on your selected repayment mode, the calculator computes interest differently:
• EMI Mode: Uses reducing balance method with compound interest formula
• Bullet Payment: Simple interest on full principal for entire tenure
• Interest Only: Monthly simple interest, principal paid at end
Step 4: EMI Computation
For EMI mode, the calculator uses the standard EMI formula where monthly interest rate is derived from annual rate (R/12/100) and applied over the number of months. This gives you fixed monthly installments that include both principal and interest components.
Step 5: Processing Fee & Total
Finally, the calculator adds processing fees (percentage of loan amount plus applicable GST) to determine your net disbursement. Total amount payable is the sum of principal, interest, and all charges. This complete breakdown helps you understand the true cost of your gold loan.
⚠️ Accuracy Note: This calculator uses standard banking formulas and current market data. Actual loan terms may vary based on lender-specific policies, gold quality assessment, market fluctuations, and applicable government regulations. Always verify calculations with your chosen lender.
❓ Frequently Asked Questions (FAQs)
Q1: How much loan can I get on gold?
You can get up to 75% of your gold's market value as per RBI guidelines. The loan amount depends on: (1) Weight of gold in grams, (2) Purity (18-24 karats), (3) Current gold rate per gram, (4) Lender's LTV ratio (60-75%). For example, 50 grams of 22K gold worth ₹3,00,000 can fetch a loan of ₹2,25,000 at 75% LTV.
Q2: What is the interest rate on gold loans?
Gold loan interest rates in India range from 8.05% to 24% per annum as of 2025. Banks like SBI, HDFC, ICICI offer rates between 8.5-11%, while NBFCs like Muthoot Finance and Manappuram charge 21-24%. Rates depend on loan amount, tenure, customer relationship, and lender type.
Q3: What is LTV ratio in gold loan?
LTV (Loan-to-Value) ratio is the percentage of gold's value that lenders provide as loan. RBI allows maximum 75% LTV for gold loans. If your gold is worth ₹1,00,000, you can get maximum ₹75,000 as loan. Most banks offer 65-75% LTV while some NBFCs offer 60-70%.
Q4: How is gold loan EMI calculated?
Gold loan EMI is calculated using the formula: EMI = [P × R × (1+R)^N] / [(1+R)^N - 1], where P = Principal amount, R = Monthly interest rate (Annual rate/12/100), N = Number of months. For ₹1,00,000 at 12% for 12 months, EMI = ₹8,885. Many lenders also offer bullet repayment where you pay only interest monthly.
Q5: What documents are required for gold loan?
Minimal documents needed: (1) Identity proof - Aadhaar, PAN, Passport, Voter ID, or Driving License, (2) Address proof - Recent utility bill, bank statement, or Aadhaar, (3) Passport-size photographs. No income proof required. PAN mandatory only for loans above ₹5 lakhs. Gold ownership proof not required.
Q6: Can I get a gold loan with bad credit score?
Yes! Gold loans are secured loans where gold acts as collateral, so credit score is not a major factor. Lenders focus on gold value rather than creditworthiness. Even with poor CIBIL score, you can get gold loan if you have eligible gold ornaments of 18-24 karat purity.
Q7: What is the minimum gold purity required?
Minimum 18 karat (75% purity) gold is required for gold loans. Most lenders accept 18K, 22K, and 24K gold. Higher purity gold (22K-24K) fetches better loan amounts. Gold is tested by certified appraisers using touchstone or electronic testing machines to verify purity before loan approval.
Q8: How quickly can I get a gold loan?
Gold loans are among the fastest loans in India. Most lenders disburse within 30 minutes to 24 hours. Process: Submit documents → Gold verification (15-30 mins) → Loan approval (instant) → Amount credit (immediate to same day). Some banks offer doorstep service where they come to your home.
Q9: What happens if I don't repay gold loan?
If you fail to repay, lender sends notices giving time to pay (typically 3 months grace). After notice period, lender has right to auction your pledged gold to recover loan amount. Any surplus after loan recovery is returned to you. To avoid this, consider loan renewal, part payment, or tenure extension options offered by most lenders.
Q10: Can I renew or extend my gold loan?
Yes, most lenders allow gold loan renewal. You can pay accumulated interest and extend tenure for another period. Some lenders allow multiple renewals. You can also make partial repayments and get proportionate gold released. Top-up facility available if gold value appreciates or you need additional funds.
🔗 Official Sources & References
All interest rates, formulas, and eligibility criteria in this calculator are sourced from official bank websites, RBI guidelines, and verified financial institutions. For current rates and detailed terms, visit these official resources:
🏦 Major Banks
🏢 Leading NBFCs
🏛️ Regulatory & Information
⚠️ Important Disclaimer: Interest rates, LTV ratios, and loan terms mentioned are indicative and subject to change based on lender policies, market conditions, and regulatory updates. This calculator provides estimates only. Actual loan amount and terms will be determined by the lender after physical gold verification, purity testing, and credit assessment. Always verify current rates and complete terms with your chosen lender before proceeding.
✍️ About the Author
Adam
Financial Calculator Expert & Gold Loan Specialist