Gold Loan Calculator
A gold loan is a quick, secured way to raise money against jewellery or coins without selling them. This gold loan calculator estimates how much you can borrow from the weight and value of your gold, applying the RBI cap on loan-to-value, and then works out the EMI. Enter the gold weight, its per-gram value, the lender's LTV and the loan terms to see your eligible amount, monthly instalment and total interest.
RBI caps gold-loan LTV at 75%.
Eligible Loan Amount
₹2,62,500
Gold Value
₹3,50,000
Monthly EMI
₹23,323
Total Interest
₹17,374
About the Gold Loan Calculator
A gold loan is a secured loan where you pledge gold jewellery or coins as collateral and borrow against their value. The amount depends on the gold's market value and the loan-to-value ratio (LTV), which the RBI caps at 75% of the gold's assessed value.
Why it is useful
Gold loans are fast to disburse, need minimal documentation and usually carry lower rates than unsecured personal loans, because the lender holds your gold as security. Estimating the eligible amount and EMI in advance helps you borrow only what you need and plan repayment so your pledged gold is not put at risk.
How the calculation works
First the eligible loan is Gold value × LTV, where the RBI caps LTV at 75%, so gold worth ₹1,00,000 supports up to ₹75,000. The EMI on that amount then uses the standard formula EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), with r the monthly rate (annual rate ÷ 12 ÷ 100) and n the number of months. If you cannot repay, the lender can auction the pledged gold after due notice and return any surplus.
Key inputs explained
- Gold weight: The weight of the gold pledged, in grams, that the lender will value.
- Value per gram: The per-gram rate for the gold purity, used to compute total value.
- Loan-to-value (LTV): The share of gold value lent, capped at 75% by the RBI.
- Rate and tenure: The interest rate and repayment period used to compute the EMI.
Example calculation
Inputs
- Gold weight
- 50 grams (22K)
- Value per gram
- ₹6,000
- LTV
- 75%
- Rate and tenure
- 9% p.a., 2 years
Calculation breakdown
- Gold value
- 50 × 6,000 = ₹3,00,000
- Eligible loan
- 3,00,000 × 75% = ₹2,25,000
- Monthly rate (r)
- 9 ÷ 12 ÷ 100 = 0.0075
- EMI
- 2,25,000 × 0.0075 × 1.1964 ÷ (1.1964 − 1)
Gold worth ₹3,00,000 supports a loan of up to ₹2,25,000 at the 75% LTV cap, and repaying it over 24 months costs an EMI of about ₹10,280, with roughly ₹21,720 of total interest. Borrowing below the cap leaves a cushion if gold prices dip.
Benefits
- Quick, low-documentation funds against idle gold you keep owning.
- Usually cheaper than an unsecured personal loan of the same size.
- See the eligible amount and EMI before you pledge.
Limitations
- The eligible amount depends on the day-to-day gold price and purity.
- Excludes valuation, processing and storage charges the lender may add.
- Default can lead to auction of your pledged gold after due notice.
Tips
- Borrow below the 75% cap so a price dip does not trigger a top-up call.
- Compare bullet-repayment and EMI options; interest handling differs.
- Choose a lender with transparent purity testing and low charges.
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About this calculator
The Gold Loan Calculator is built and maintained by the PaisaBot team. All calculations run instantly in your browser using established financial formulas, and we use high-precision arithmetic to keep the results reliable.
Data accuracy: Interest rates, tax slabs, and scheme rules are updated periodically, but figures can change with RBI, government, and lender revisions. Always confirm the latest rates with your bank or an official source before acting.
Educational purpose: This tool is provided for general information and financial education only. It does not constitute investment, tax, or legal advice. For decisions specific to your situation, please consult a qualified financial advisor.