In a pursuit to bring back the losses due to the lockdown, there is a shift in loan procedures. The financial market is eyeing gold locked in our chest, due to which many banks are bringing gold loans. As per reports, there is a lot of potential in it. 22-25 thousand tonnes of gold lying in homes.
As per the World Gold Council, about 22-25 thousand tonnes of gold are lying in homes in India, which are currently not being used financially. It has around 65% share in rural India. Financial experts say that currently, around 1.2 % of the gold stock is collateral of loans. In such a situation, there is a lot of potential in gold loans.
Banks Giving Gold Loans:
Amidst the pandemic, several banks including State Bank of India, Canara Bank are coming up with gold loans. Canara Bank has made a separate gold loan business for this. State-run banks say that they will also provide such loans to farmers. In such a situation, they will take up gold loan and do the farming and after harvesting the money they will withdraw the gold. Apart from this, any needy can use this facility.
Interest rate 7.85%
Canara Bank has started a separate special business unit for customers by pledging gold for loans. The bank has taken this step in view of the money related challenges faced by customers due to the Coronavirus pandemic. The bank will campaign for gold loans till June 30 this year. In this, customers will be given loans at 7.85 percent annually. Canara Bank said in a statement that the loans through it can be used for various purposes including agriculture and allied activities, business needs, health emergencies, and personal needs. According to the bank, this loan can be taken from the marked branches. Customers will have to repay this loan in one to three years with a flexible payment option.
Relief in repaying loan and 3 months grace period:
Due to the pandemic, the economy of India is continuously sinking. In such a situation, the demand for gold loan will increase considerably and it will be less risky for banks too. The price of gold is also increasing continuously due to the increase in demand.
Present Cost of Gold:
Breaking records, gold price crossed Rs 35,000 per sovereign. The price for one sovereign of gold rose by Rs 240 for a sovereign on Monday and touched Rs 35,040. One gram of gold is priced at Rs 4380. Spot gold price in the international market increased by one percent and touched 1759.98 Dollars per ounce. The price of silver increased by two percent and reached 16.96 Dollars per ounce.