[caption class="snax-figure" align="aligncenter" width="662"][/caption]With the Coronavirus pandemic hitting the world hard, an individual’s financial situation is battered. Loosing of cash, salary cuts and household income squeeze have led people to choose Financial Institutions to avail loans. Still, people are able to meet their requirements? Most of the time, they are not! They fail to differentiate between the gold loan and other loans. With that, they are getting confused about which loan serves their purpose better. a personal loan requires no collateral security; the approval of the loan is totally based on the profile of an applicant and the income of a person. In this situation, one has to consider all the pros and cons of the financial options available.
One can choose the Standard Chartered Bank Personal Loan, with great service they are leading in the market.
Gold Loans; the best option
Fortunately, the booming in gold prices have come to their rescue by allowing people to opt for gold loans over any other loans. It is assumed that gold loans can overcome cash crunch as other avenues entail huge costs and may put the borrowers under stress later. Gold loans are short-term loans that are limited to a few months to a year and can serve short-term requirements. And gold loans are less expensive and are more attractive compared to personal loan to the below-mentioned benefits:
Fast approval and easy disbursal process: As verification of these documents requires some time, disbursal of personal loans usually take 2-7 days of the loan application.
Higher loan amount: the loan amount in the case of gold loan basically depends on the valuation of gold deposited as collateral.
No credit history required: Gold loan does not require any credit history of an individual, anyone can opt for a gold loan whether he has a low credit score.
Low-interest rate: The interest rate on gold loans can range from 7.30% to 28% p.a. basis the loan tenure. Whereas Interest rates on gold loans are higher for those with long tenure or higher LTV ratios.
Flexible repayment options: Gold loans, allow various repayment options in addition to the EMI-based repayment structure.
Hassle-free documentation: Verification of personal loan documents requires some time, disbursal of personal loans usually take 2-7 days, but for a gold loan, it can be done very fast and with ease.
Furthermore, the borrower gets the opportunity to improve their Credit score by repaying the interest or the loan on time.
Owing to the financial crunches, banks and other financial institutions have become more careful when it comes to giving unsecured loans such as personal loans. It requires more paperwork and documentation. Because of this reason, the best option is gold loans instead. An applicant can opt for a gold loan and walk out of the branch in a matter of a few minutes.
Too many options to avail gold loan- whether from Financial Institution or Gold Jewellery.
When it comes to pledging the gold, it is the perfect option for quick funds in India as the country is the second-biggest consumer of gold worldwide. Speaking of the history of pledging business dates backs to centuries. However, monetizing gold has become more popular and popular in the last couple of years, and the money is utilized for productive and development purposes.
One of the most important thing one should think about the lenders. It is about choosing a financial Institution whether its a bank or a gold loan from jewellery/unorganized sector.
Several aspects decide: how do you make the right choice? Let us see some benefits of opting for a gold loan from financial institutions over others:
Low-Interest rate
More loan to value (LTV)
Flexible tenure: For gold loans, the tenure is seven days to three years with a few lenders offering tenures of up to five years.
More repayment options
Bullet payment options
Transparency
More accountability and reliability
In addition to that, Lenders offer more security to the gold pledged for the reason that most of the NBFCs have insurance coverage for the pledged gold. Governance and compliance under the guidelines of Reserve Bank Of India make NBFCs more accountable. The above points ensure financial institutions as better options because of the safety of the gold.
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