Agriculture Gold Loan Online- Gold Loan for Farmers in India

Leading banks and NBFCs offer various financing options tailored to the needs and requirements of farmers in India. One such personalised credit option is the gold loan for agricultural purposes. The main purpose of the gold loan is to provide quick access to funds for farmers to meet their needs.

Gold loan for agricultural purposes allows farmers to get funds to cater to financial requirements such as crop production and other allied activities like dairy, poultry, etc. Gold loans for farmers help access funds and fulfil expenses associated with buying inventory, purchasing land, equipment, machinery, raw materials, etc.

An agriculture gold loan is similar to a gold loan, where you receive funds in exchange for gold assets you pledge. This loan allows farmers to pledge gold assets and use the amount for purposes such as machinery, tools, purchasing seeds, and fertilisers. 

As the Government of India provides several loan schemes to support farmers, many banks and financial institutions have introduced them. The gold loan for agriculture purposes reduces the risk for lenders and, therefore, comes with lower interest rates.

An agricultural gold loan allows farmers to leverage gold assets for quick access to funds, with several advantages, such as low interest rates and minimal documentation. Here are the key reasons to consider this loan:

• Low Interest Rates

The interest rate for these loans typically starts from 8.88% p.a.

• Easy Loan Process

Benefit from a hassle-free application process and quick disbursement of funds

• Minimal Documentation

Enjoy simple documentation and verification through the easy online application process

• Safety

Gold is kept safely in bank vaults with in-built motion sensors and 24/7 surveillance

• Convenient Repayment Schedule

You can choose to pay the amount either in EMIs or lumpsum, as per your repayment capabilities

• Loan Renewal Facility

Some banks also offer loan renewal facilities to borrowers

• Part-release facility

You can release a portion of the pledged gold by repaying a sum equivalent to its current market value. However, check with your lender if the part-release facility is available at the pledged value of the gold

• Collateral

Farmers can provide collateral such as gold coins and ornaments

The criteria requirements for these loans vary by lender. Some of the common eligibility criteria for this gold loan include:

• Status of the Farmer

Applicants need to be engaged in farming activity or be a farmer. Applicants for this loan may include farmers, traders, business owners, or self-employed professionals.

• Possession of Gold

The gold assets provided as collateral can be in the form of jewellery or other types. Lending institutions conduct purity tests to verify the actual quality of the gold.

• LTV Ratio

The Loan-to-Value (LTV) ratio refers to the percentage of the gold's value that a bank or institution provides as a loan. Generally, up to 75% of the gold’s value is offered as funds, though this varies depending on the lender.

• Age Limit

The minimum age required for an agricultural gold loan is 18 years. The maximum age limit depends on the lender and can range from 75 to 85 years.

• Legal Supporting Documentation

Applicants need to provide supporting documents whether applying offline or online. This includes address proof such as an Aadhaar card, passport, PAN card, and land records. Documents proving the legal purchase of gold, such as receipts or transaction bills, also need to be submitted.

Some documents required to get a gold loan for farmers for agricultural needs include KYC documents, land papers, and photographs. Other documents include:

• Complete the application form with passport-sized photographs

• KYC Documents for address and identity proof: 

  1. PAN card

  2. Aadhaar card

  3. Passport

  4. Voter ID 

  5. Utility Bills (water, electricity, etc.)

  6. Driving Licence

• Agriculture land proof

• Crop cultivation proof

• Business Incorporation Certificate

Through Bajaj Markets, applicants can obtain a gold loan of up to 75% of the value of gold. The loan amount depends on the actual purity and weight of the gold. 

Getting a loan or transferring the existing loan to Bajaj Markets provides additional benefits, such as a partial gold release facility. Based on the eligibility and the value of the gold assets, applicants can select a flexible loan amount according to the financial requirements.

The interest rate on agricultural gold loans varies depending on the lender and several other factors. However, agricultural gold loans typically offer lower interest rates, allowing borrowers to secure higher-value loans with reduced interest costs. 

With Bajaj Markets, interest rates start at 8.88% per annum. Additionally, borrowers can foreclose the loan and reclaim their gold assets without incurring any foreclosure charges.

Banks and financial institutions offering agricultural gold loans provide flexible repayment options with extended tenures. 

With Bajaj Markets, the maximum tenure is 36 months, and borrowers can choose a repayment schedule that fits their financial situation. Available options include monthly, quarterly, half-yearly, or yearly payments.