Agriculture Gold Loan

Gold loans for agricultural purposes provide farmers with quick access to funds, helping them meet financial needs for crop production, dairy, poultry, and other related activities. Leading banks and NBFCs offer these loans, tailored to support farmers' needs.

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 funds for agricultural needs, such as purchasing machinery, tools, seeds, and fertilisers. 

Supported by various government loan schemes, many banks and financial institutions offer these loans. Since gold loans reduce the risk for lenders, they typically come with lower interest rates.

An agricultural gold loan allows farmers to leverage gold assets for quick access to funds, offering benefits like low gold loan 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 9.48% p.a. on Bajaj Markets

• 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,

• Quick Access to Funds

Farmers can access funds quickly to meet urgent agricultural needs, such as purchasing machinery, seeds, fertilisers, and more

• Low Interest Rates

Gold loans are secured loans, which means they come with lower interest rates compared to unsecured loans, making them an affordable option for farmers

• Easy Approval Process

With minimal documentation required, the loan approval process is simple and fast, ensuring farmers get the funds they need without delays

• Flexible Repayment Options

Farmers can choose repayment terms that suit their financial situation, with flexible EMI options and repayment periods

• Use of Gold Assets

Farmers can leverage their gold holdings to secure a loan, ensuring they don’t have to sell valuable assets for cash

• Government Support

Many banks and financial institutions offer agriculture gold loans supported by government schemes, which often include subsidised interest rates and other benefits

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

• Nationality

You must be an Indian citizen to apply for the loan.

• Age

Applicants must be at least 18 years old. The maximum age limit typically ranges between 60 to 75 years, depending on the lender.

• Gold Purity

The gold purity must be at least 18 karats. The higher the purity, the better the loan terms, but gold as low as 18K is generally accepted.

• Possession of Gold

You must own gold assets, such as jewellery, coins, or other gold items, which will be pledged as collateral for the loan. The gold will be evaluated by the lender to determine the loan amount.

• Loan-to-Value (LTV) Ratio

The Loan-to-Value (LTV) ratio determines how much of the gold’s value the lender is willing to offer as a loan, which typically ranges from 60% to 80%, depending on the lender and the purity of the gold.

• Documents

Applicants need to submit proof of identity (e.g., Aadhaar, PAN, passport), address proof, and documents proving the legal ownership of the gold (e.g., receipts, transaction bills).

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 9.48% per annum. Additionally, borrowers can foreclose the loan and reclaim their gold assets without incurring any foreclosure charges.

Repayment

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

With Bajaj Markets, the maximum gold loan 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.

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