PNB Gold Loan

Punjab National Bank (PNB) offers loans against gold coins, gold ornaments and jewellery to PNB customers in India. PNB gold loan can be used for productive purposes such as agricultural activities and related activities or any other purposes like education, medicine and unplanned emergencies. Under this scheme, any existing or new customers can avail gold loan of up to Rs.10 lakhs by pledging of gold ornaments which includes gold coins sold by banks. In this article, we look at the PNB gold loan scheme in detail.

Know more about how to obtain collateral free loan click here

Eligibility Criteria

The following are the eligibility criteria for obtaining  gold loans from Punjab National Bank:

• The age of the applicant should be 18 years at the time of applying for the loan.
• The applicant should be a permanent resident of India.
• The applicant must be an employee of a company or public sector undertaking, which includes central, state and local bodies.

Features of the PNB Gold Loan

The features of the PNB gold Loan are as follows:

• An individual can avail a maximum amount of about Rs.10 lakhs.
• Under this loan scheme, the loan amount will be processed within 30 minutes from the approval of the application.
• The borrowers are granted with the facility of hassle-free and quick loan sanctions with attractive interest rates on the term loan, overdraft and EMI based loan.
• Punjab National Bank offers attractive interest rates and priority processing for availing the loan for the agricultural purpose.

Quantum  of Loan

The borrower can obtain the maximum loan amount of Rs. 10 lakhs for the productive purposes and the loan above Rs.10 lakhs for the non-productive purpose will be processed depending upon their requirements.

Types of PNB Gold loans

The PNB has gold loan schemes for professionals and salaried individuals.  The amount received as a loan can be used for either multiple or specific purposes.

Margin

The PNB gold loan scheme requires a margin of 35% for bullet payment option and 25% will be for payment of interest.

Security

The Gold coins, Gold jewellery and ornaments are required. However, advance against the collateral security of gold coins sold by PNB or any other scheduled bank (which are especially gold coins), the weight of the coins should not exceed 50 grams per customer.

Valuation

As per the RAD statement, the amount of loan can be availed only against 22-carat gold at prescribed intervals (presently monthly basis). In case Gold with purity, less than 22-carat is accepted as security, and the value is converted proportionately into 22-carat for financing under the scheme.

Loan to Value Ratio

Once the value of gold is calculated, PNB will apply a Loan to Value (LTV) to calculate your gold loan amount eligibility. If you are willing to take a loan amount lower than your maximum LTV, PNB may offer you a lower interest rate. The LTV ratio will be calculated against the total outstanding in the account, including accrued interest, and the current value of gold jewellery accepted as security or collateral.

Repayment of Loan

Loans for Agricultural Purposes:

Any of the following options can be accompanied to repay the loan:

• The repayment period fixed for the borrower is up to 12 months. Interest will be levied from the account every month but will become outstanding payment along with the principal at the maturity.

Note: In case of Overdraft facility has to be renewed annually (Keeping in view seasonality of the crop, the Circle Head may permit repayment within a maximum period of 18 months).

• The repayment can be made through Bullet Payment, i.e. payment of interest and principal at maturity.

Loans for Non-Agricultural Purposes (Productive & Non-productive):

Any of the following options can be accompanied to repay the loan:

• The repayment period fixed for the borrower is up to 12 months. Interest will be levied from the account monthly but will become outstanding payment along with the principal at the maturity.
• The repayment can be made through Bullet Payment, i.e. payment of interest and principal at maturity.

Prepayment Charges

The PNB bank offers the prepayment facility wherein the customer can repay the entire loan amount before completion of the original tenure by without remitting any prepayment charges for it.

Rate of Interest

The interest rates charged on PNB gold loan is tabulated below:

Purpose of Loan		Rate of Interest
Productive Purpose	For agriculture	Marginal Cost of funds based Lending Rate (MCLR)+1.60%
	Others	Marginal Cost of funds based Lending Rate (MCLR)+2.60%
Non-Productive Purpose	Public or Staff	Marginal Cost of funds based Lending Rate (MCLR)+2.60%

Processing Charges or Upfront Fee

The charge required for processing your loan application will be around 0.25% of the loan amount.

Note: Additionally, GST and other Government taxes, levies etc. are applicable as per prevailing rate will be charged apart from the fees.

Documentation Charges

The documentation charges of Rs.250 will be collected for availing gold loan from the PNB.

Documents Required for PNB Gold Loan

The following are the documents which are required for processing your PNB gold loan.

• Identity Proof: Driving License or PAN Card or Form 60/61 or Passport or Voter ID Card or Aadhaar Card or Ration Card.
• Address Proof: Driving License/Voter ID Card/Ration Card/Aadhaar Card/Passport/registered lease agreement utility bills in the landlord name.
• Proof of landholding in case of agriculture loan 
• Two passport size photographs

Application Procedure for PNB Gold Loan

The eligible applicant who wants to apply for the PNB Gold Loan has to approach the nearest PNB branch of your area and collect the application form from the bank. Complete the application form with the mandatory details and attach the required documents. After filling the form, submit the same to the appropriate bank.