How much loan per gram of gold?

The loan amount one can receive per gram of gold depends on the prevailing price of gold and the maximum loan-to-value (LTV) ratio set by the Reserve Bank of India (RBI). As per the latest guidelines, the LTV ratio is capped at 75% for loan amount. This means that lenders can offer up to 75% of the value of the gold pledged as collateral. The value of gold is typically assessed based on the current market rate of 22-carat gold, even if the jewellery is of a lower purity; the value is adjusted accordingly.

For example, if the market price of 22-carat gold is ₹6,000 per gram, you may be eligible for a loan of up to ₹4,500 per gram (75% of ₹6,000), subject to deductions for impurities, making charges, and other factors. The final gold loan amount you receive will depend on how the lender values your gold. If your jewellery has stones, gems, or any parts that are not gold, those portions are not included in the calculation. Lenders focus only on the pure gold content when deciding how much to sanction.

Each lender may have slightly different ways of assessing and deducting for non-gold elements, so the amount you are offered can differ from one lender to another. It’s always a good idea to clarify with the lender how they will value your jewellery before you proceed, so you know what to expect. Always check with the lender for their specific valuation process and ensure you understand the terms before proceeding.