Gold Loan in India 2026: Rates, Costs and How to Choose

Last reviewed: 10 October 2026. Rates and charges checked on each bank’s official website. See how we rate loans.

Gold loan interest rates in India start between 8.50% and 9.55% a year at the eight banks we compare, which makes borrowing against jewellery cheaper than most unsecured credit. The ranges above those floors are wide, though, with some private banks disclosing rates of 19% or more. Only Bank of Baroda and Union Bank of India show gold loan benchmarks dated after the RBI raised the repo rate to 5.50% on 7 October 2026.

For bank-by-bank notes and full charges, see our full gold loan interest rates comparison.

Gold loan interest rates compared (October 2026)

Bank	Lowest rate	Range	Processing fee	Repo hike
Federal Bank	8.50%	8.50% to 22.90% (April to June 2026)	0.39%, minimum ₹500	Before
Axis Bank	8.95%	8.95% to 19.00% (April to June 2026); rate page 9.75% to 17%	Up to 1.5%	Before
HDFC Bank	9.00%	9.00% to 19.00% (January to March 2026)	Up to 1%	Before
ICICI Bank	9.00%	9.00% to 16.00% (April to June 2026)	Up to 2%	Before
Kotak Mahindra Bank	9.00%	9% to 20%	2%	Not stated
Bank of Baroda	9.00%	Fixed 9.00%, or floating on BRLLR	Nil up to ₹3 lakh; 0.50% above, max ₹3,500	After (floating)
SBI	9.15%	9.15% (12-month bullet) to 10.10% (EMI and overdraft)	0.50% on the bullet loan (₹500 to ₹10,000)	Before
Union Bank of India	9.55%	9.55% to 9.90% (Swarna Shakti retail)	0.50%, max ₹1,000	After

Rates % a year for personal (non-farm) gold loans; fees exclude 18% GST. Several private banks publish only the rates they actually charged in a past quarter, shown with the period. Mean rates at the private banks were 10.86% to 11.29%, well above their floors.

What a gold loan actually costs

Gold loans are usually short. Here is ₹2 lakh on a 12-month bullet loan, with interest and principal repaid at the end, at a selection of lowest rates from our full comparison:

Rate	Bank	Interest for 12 months	Fee incl. GST	Interest plus fee
8.50%	Federal Bank	₹17,000	₹920	₹17,920
9.00%	Bank of Baroda	₹18,000	Nil	₹18,000
9.00%	ICICI Bank	₹18,000	₹4,720	₹22,720
9.15%	SBI	₹18,300	₹1,180	₹19,480
9.55%	Union Bank of India	₹19,100	₹1,180	₹20,280

The ICICI row shows why the fee matters: it matches Bank of Baroda’s 9.00% rate but ends up about ₹4,700 dearer once its fee of up to 2% is added. If you prefer monthly instalments, Bank of Baroda’s fixed 9.00% works out to an EMI of ₹6,360 on ₹2 lakh over 36 months, against ₹6,463 at SBI’s 10.10%. Model other amounts on our loan calculators.

What decides your gold loan rate

Loan type and tenure

Bullet loans and EMI loans are priced differently. At SBI the 12-month bullet costs 9.15% while EMI and overdraft versions cost 10.10% for up to 36 months.

Gold purity and borrower profile

Union Bank gives 22 carat gold a 0.25% lower rate than lower purity, and women pay 0.10% less. ICICI says credit scores do not affect its gold loan pricing.

Benchmark

SBI prices off its 1-year MCLR of 8.70%, reset before the hike. Bank of Baroda’s floating option and Union’s rate follow benchmarks already revised for the 5.50% repo.

How much you can borrow

Since 1 April 2026, every bank follows the RBI’s harmonised gold lending rules. For personal use, you can borrow up to 85% of the gold’s value on loans up to ₹2.5 lakh, 80% from ₹2.5 lakh to ₹5 lakh, and 75% above that. Banks can lend less: Bank of Baroda’s own limits are 65% to 75%, and SBI’s bullet loan carries a 35% margin. Bullet loans for consumption are capped at 12 months.

Prepayment and foreclosure

SBI, Bank of Baroda and Union Bank charge nothing to repay early. HDFC charges 2% within 30 days and 1% between 31 and 180 days. Axis charges 2% if you close within six months, though part payments are free, and Kotak charges 2% after a lock-in. Once you repay in full, RBI rules require the lender to return your gold within seven working days or pay you ₹5,000 for each day of delay.

Checklist before you pledge your gold

Ask for your exact rate in writing, not the published range.
Check whether pricing has changed since the 7 October repo hike.
Compare interest plus fee in rupees; fees run from nil to 2%.
Choose a bullet loan only if you expect a lump sum within 12 months.
Check the per-gram value and the bank’s own loan-to-value limit on the day.
Keep the pledge receipt and track the seven-working-day return rule when you close.

Frequently asked questions

Which bank has the lowest gold loan interest rate?

Federal Bank’s lowest rate charged in April to June 2026 was 8.50%, followed by Axis Bank at 8.95%. Among banks on a post-hike benchmark, Bank of Baroda’s fixed 9.00% is lowest.

How much interest will I pay on a ₹2 lakh gold loan for a year?

At the lowest rates here, between ₹17,000 and ₹19,100, before fees.

Which bank charges the lowest processing fee?

Bank of Baroda charges nothing up to ₹3 lakh. Union caps its fee at ₹1,000, and Federal charges 0.39%.

How much can I borrow against my gold?

Up to 85% of its value for loans up to ₹2.5 lakh under RBI rules, though banks may lend less.

Is a gold loan cheaper than a personal loan?

Usually, because it is secured. Compare on our personal loan interest rates hub.

Compare all eight banks in detail on our gold loan interest rates hub.

This article is for informational purposes only and does not constitute financial advice. Loan rates change often; confirm the latest terms with the bank before you apply.