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Personal Loan OR Gold Loan??? What do I prefer!

Author: Ushali Mishra
by Ushali Mishra
Posted: Nov 14, 2019

At some point of time anybody gets confused as what to choose between personal loan or a gold loan to meet their immediate requirement of funds. There are many factors that affect your decision making. Gold jewelry & gold ornaments is your investment made in gold over a period of time. Gold jewelry is considered as an important investment in the Indian culture. Pick any house in India, and you will not find any house that has no gold jewelries. Also women have a special attachment towards gold jewelries /ornaments. It is this attachment that sometimes makes it difficult to mortgage it for getting loan i.e. the gold loan.

Personal loan on the other hand is quick, instant and does not require any security. The recent personal loan apps by few NBFCs have simplified it further by providing an online portal for instant applying, approval & disbursement of the personal loan. Banks also provide pre-approved personal loans to its account holders in n the basis of his banking transactions. While for gold loan you have to personally visit the bank/NBFC along with your gold. Since in gold loan you already provide your gold as a security to get the loan the rate of interest for gold loans are low in comparison to personal loan.

Let's find out the v/s factors of personal loan & gold loan.






Type of unsecured loan.

Secured loan taken against the pledging of gold as a security.

You need not visit the branch to take a loan.

Have to personally visit the branch to apply for a loan.


Rate of Interest

Being an unsecured loan rates of interest are higher. 11% - 24%.

Rate of interest are as low as 10% - 14%.

Can be fixed as well as floating.

Fixed rate of interest.



Tenure - up to 7 years.

Tenure - for maximum 12 months.


Processing Fees

2%- 4% of the loan amount.

1%- 2% of the loan amount.


Foreclosure Charges

Up to 4% of the outstanding loan amount.

1% of the outstanding loan amount if closed within 11 months& nil if closed after 11 months in a 12 months tenure.


Loan Renewal

Personal loan cannot be renewed. You have to apply for a fresh new personal loan.

Possible to renew the gold loan for the next 12 months.


Loan Sanction

Sanctioned on the basis of source of income and repayment capacity of an applicant.

Sanctioned by accepting the gold as pledge.


Loan Approval

a)Takes 3 to 5 working days.

b) In pre approved personal loan, the approved amount is credited to your bank account within fraction of seconds (for those using mobile banking).

Takes maximum 30 minutes to 1 hour for the approval



Done in the form of equated monthly installments which is the combined amount of principal as well as the interest component.

Loan is repaid at the end of the loan tenure. No hassle of paying EMIs, only pay interest periodically.

Repayments can be made in cash, by cheque or DD.

Inquiry For Personal Loan Visit-

Inquiry For Mortgage Loan-

About the Author

Ushali Mishra - founder of Loanfasttrack - Mumbai based company- specializing into loan industry and offering a multiple loan products - Home Loan, Mortgage Loan. Business Loan, Car Loan & Personal Loan.

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Author: Ushali Mishra

Ushali Mishra


Member since: Aug 28, 2019
Published articles: 2

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