Nowadays, in our contemporary world, digital payments have become a necessity. If individuals are confused about getting gold loans digitally, they need to go through proper research on the available platforms and verify their credibility. After the COVID-19 outbreak, gold loans have become a popular borrowing option. Online gold loan technology brings us a new life because it takes very minimum time & it is safe.
Like every other loan, it is very important to understand & consider certain factors before taking a gold loan. Some of these important factors are mentioned below –
The loan amount depends on gold value & purity
The loan amount which the digital lender gives is always dependent on the value of the gold because the valuation of gold is straight away balanced to the purity of the gold. Here is essential information for individuals who want to get a digital gold loan. Note that the purity of gold must be a minimum of 18 carats to be eligible for a loan.
Many lenders use gold loan rates per gram, upwards of 60% of the gold value, to fund against gold loans. Individuals always need to verify the rate per gram to get the optimal deal against their jewelry.
Need to compare gold loan Interest rates before taking a loan
As we all know, the gold loan interest rate is always ascertained by the lender’s risk assessment of the borrower. This easy gold loan rate may vary between 5-30 % per annum. Lenders use some factors to determine the interest rate on gold loans, they are –
- LTV ratio (Loan-to-Value),
- Loan amount,
- loan tenor and other factors.
Individuals need to choose those types of gold loans, which allows the lowest interest on gold loans per month.
Choosing fast disbursement loan
As per many experienced borrowers, the other crucial factor to consider is the ease and speed at which the loan will be disbursed.
Today in most banks, valuation specialists are invited before appointments, making the loan process much longer. The other factors include proper documentation, KYC verification, valuation, and other activities, which take a lot of time and delay loan disbursement.
But the modern online gold loan process startups eliminate this problem by using techniques such as –
- e-KYC,
- e-documentation,
- and doorstep valuation.
This results in immediate disbursement.
Need to check the background of lender:
Gold loans can be availed from different sources like –
- banks,
- NBFCs,
- even gold jewelers.
As we all know, the banks are trustworthy & perfect sources, but a proper credibility check is essential for the other two types of lenders.
Sometimes, gold jeweler lenders provide even lower interest rates than banks, which is profitable. However, Individuals still must not wholly trust the jeweler before taking a loan from them. As in this type of loan, there is a chance of fraud with jewelers and lesser-known NBFCs.
Check repayment process
Usually, in the repayment process of gold loans, the individual or borrower needs to pay their regular EMIs. And after the loan tenor ends, all remaining dues are cleared, and the gold treated as security is returned to the borrower.
Digital gold loans are not the most profitable option, but they are always better than personal loans due to fewer paperwork requirements and minimal interest rates. Individuals can go for gold loans where they are confident with payment regulations and interest dues within the loan tenor.
Customer support system
The customer support system is essential to resolve borrowers’ queries. This is why individuals always need to choose a gold loan lender with a well-maintained customer support system. If a gold borrower goes through uncertain and challenging situations, the customer support system can help solve the problem with repayment options.
If an individual follows or considers the factors which are mentioned above, then they never have to worry about how to get gold loans. Nowadays, there is no problem with getting an easy gold loan. It is a time-saving process and very secure process. After the loan clearing process, people will get their gold in the same condition as they gave it to the lender. All you have to do is research before borrowing against gold digitally.