How do lenders determine the maximum loan amount for mixed karatage gold?

While approving for gold loan, in the case of mixed-purity jewellery, they don’t guess. Each piece is looked at on its own so the value isn’t affected by one heavier or purer item.

Sorting, Testing, Net Weight

Items are grouped by karat (18K, 20K, 22K, etc.). Purity is checked. Then everything is weighed. Stones, beads, enamel — all set aside. Only the net gold weight counts for your gold loan.

Working out the Value

Each group gets its own rate based on purity and the day’s market. Many branches, while approving your gold loan, refer a short average (last few weeks) so one volatile day doesn’t help or hurt you unfairly.

Deciding the Maximum You Can Borrow

They total the value across groups and apply a loan-to-value (LTV) percentage. That percentage for your gold loan falls within policy and regulatory limits. Different lenders keep different cushions for gold loans, so two institutions may quote slightly different numbers on the same ornaments.

What Can Move the Number Up or Down?

• Higher average market price → slightly higher eligible amount.
• Lower purity, dents, or lots of non-gold parts → can reduce the amount.
• In short, it’s a piece-by-piece exercise: sort, test, weigh, value, then apply LTV — simple, careful, and documented.