Product

• Union Gold Loan MSME- Monthly interest payment

Purpose of Gold Loan

• Gold loan can be sanctioned for all eligible purposes under priority sectors. Typically, requirements under other priority sector are loans for day to day working capital requirement of business unit, petty trade, purchase of furniture & Fixtures etc. the loan amount will be sanctioned based on a declaration by the borrower.

Eligibility

• All individuals engaged in Manufacturing/trading/ services sectors for working capital requirements, expansion of business etc. owning gold ornaments/ Jewellery/ Coins, either singly or jointly.
• Loans can be granted against gold ornaments/Jewellery and specially minted pure gold coins sold by our bank/other bank. The total weight of the coins should not exceed 50 grams per customer.
• UDYAM/MSME/SSI registration is mandatory.

Assessment of Loan Amount

Limit under Gold Loans is to be assessed as under:

• A. Loan amount requested by Applicant/assessed amount on declaration;

OR

• B. 70% of the appraised value of Gold Ornaments of 22 Karat fineness for gold loan repayable within 12 months tenure (65% of the appraised value of Hall mark Gold ornaments of 22 Karat fineness for of below 22 Karat up to 20 Karat fineness applicable to 7 designated zones i.e., Chandigarh, Delhi, Lucknow, Ranchi, Varanasi, Bhopal and Jaipur)

OR

• C. Amount eligible based on the per gram rate fixed by the bank for 22 Karat fineness (daily price data and the Quantum of Gold Loan/Per gm to be taken from link created in UBINET).

OR

• D. Loan amount assessed based on Credit requirements like MSME, other Priority Sector as the case may be.

Eligible loan amount: A/B/C/D -WHICHEVER IS LOWER

Note

• Specially minted gold coins sold by any Bank (24 Karat fineness) up to 50 grams shall be treated as gold ornaments (22 karat fineness) for loan assessment purpose.
• If gold ornaments are of Hall mark 22 Karat fineness Rs.50 extra per gram can be given under this scheme.

Quantum of Loan Amount

• Min- NA
• Max-50.00 lakh

For Hall-marked gold of 20 karat maximum quantum of loan amount shall be restricted to Rs 5.00 lakhs per borrower/customer ID.

Margin

• Margin 30% for 22 karat fineness
• Margin 35% for 20 Karat fineness of Hall mark Gold ornaments

Repayment

• Maximum Tenure-12 Months.
• Interest will be charged to the account at monthly rests and demanded on monthly. Interest to be serviced as and when debited.
• LTV of 75 per cent shall be maintained throughout the tenure of the loan for all loans extended against pledge of gold ornaments and jewellery for non-agricultural purposes. The LTV ratio shall be computed against the total outstanding in the account, including accrued interest and current value of gold jewellery accepted as security / collateral, determined as per the methodology prescribed in the Operational guidelines circular.

Rate of Interest

For 22 karat-

• For below 22 karat- 25 basis point higher than 22 karat.

#Subject to revision from time to time

Processing charges

• 0.50% of loan amount or Max. 1000

#Subject to revision from time to time

Appraisal Charges

#Subject to revision from time to time

Benefits

• Processing charges: 0.50% of loan amount or Max. Rs. 1000+GST

#Subject to revision from time to time