No, Gold Loan can be availed against the pledge of gold ornaments only.

The purity of the gold ornaments you are going to pledge and the average market price of gold of that particular purity are two key factors that affect the per gram rates while availing a gold loan. The purer the gold is, the higher its value is going to be. For example, 22 karat gold ornaments have a higher value than 18-karat or 20 karat ones.

To calculate the gold loan amount, you will have to check the rate of gold on that particular day. This per gram gold rate is multiplied by the weight of the gold ornaments. Once you have the value of the gold ornaments you are going to pledge, you can calculate the loan amount using the LTV ratio of 75%. Usually, the LTV ratio for a gold loan is 75%. This means that the loan amount will be equivalent to 75% of the gold value.

For 1 gram of gold, you will be able to avail a loan amount equivalent to 75% of the market price of the metal on that particular day. Muthoot Finance offers the highest per gram rate for a gold loan.