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Pledging gold as collateral to meet financial needs has been an constant feature of the Indian gold market. Traditionally, households use gold loans to meet costs of health, education and marriage, while small businesses use them for their working capital needs.
To do so, you visit a lending institution with the gold you want to pledge and the required documents. The lender performs gold purity checks and determines its weight on the basis of which it evaluates its market value. Gold loans can be sanctioned up to 80 percent of the calculated value of the pledged gold.
Procedure to release gold: It is required to submit the original documents with proper identification at the first step. ... Companies and Organizations can then contact the financier or bank and pay the partial amount to release a part of the pledged gold. ... Now, customers can get the jewellery from the company.
Respected Sir/Madam, I would like to state that my name is ___________(Name) and I hold a gold loan account in your bank bearing account number ______________ (Account Number). I am writing this letter to request you to kindly close my gold loan account bearing account number ____________ (Loan Account no.).
To do so, you visit a lending institution with the gold you want to pledge and the required documents. The lender performs gold purity checks and determines its weight on the basis of which it evaluates its market value. Gold loans can be sanctioned up to 80 percent of the calculated value of the pledged gold.
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People also ask

A gold loan is granted to you when you give gold jewellery as collateral to the lender. The amount of loan is usually a percentage amount, up to 75% of the value of the pledged gold. You are required to repay the loan in instalments. Once you repay the loan, plus the interest amount, you will get your gold back.
Therefore, in India, creditors prefer to take gold ornaments as collateral. Banks neither accept gold bars nor gold bullion for gold loan. You can avail gold loan against gold coins but they must be 99.99% pure with weight not exceeding 50 grams.
To do so, you visit a lending institution with the gold you want to pledge and the required documents. The lender performs gold purity checks and determines its weight on the basis of which it evaluates its market value. Gold loans can be sanctioned up to 80 percent of the calculated value of the pledged gold.
The purpose of the loan is for \u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.. I hereby declare that the loan amount will be utilized for agricultural operations. Rate Per Gram - Rs\u2026\u2026\u2026\u2026\u2026\u2026. Date: Manager/Officer in Charge Received back the jewels pledged.
1. They operate on gold funding and spread arbitrage.. This is perhaps the most important aspect of the gold loan business. If you approach a gold loan company with your jewellery, they will finance you to the extent of 60-70% of the value of the gold (RBI restricts LTV at 75%).

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