Common questions
Gold pricing, plain-spoken — what jewellers do and don't include in your bill.
Gold loans, plain-spoken — what the RBI April 2026 directive actually says, and how banks and NBFCs differ.
How is the fair price of gold jewellery calculated?
The fair price has three parts: the metal value (live gold rate × weight × purity), the jeweller's making charge (usually a percentage of the metal value), and 3% GST if buying in India. This calculator uses live bullion rates that mirror what Indian jewellers price against.
What gold price benchmark does this calculator use?
Live international spot prices, refreshed every 5 minutes. For Indian rupee pricing, the calculator applies the typical premium that local bullion benchmarks carry over spot — so the result tracks what jewellers are pricing against on a given day.
What is making charge — and what's a fair amount?
Making charge is the jeweller's fee for crafting the piece, expressed as a percentage of the metal value. Simple machine-made pieces are usually 6–10%. Standard hand-finished work is 10–15%. Bridal and intricate sets often run 20% or more — confirm the rate before agreeing to a piece.
Why does my jeweller's quote differ from this estimate?
Common reasons: a slightly different benchmark rate (each shop adds a small markup over the day's bullion rate), wastage charges layered on top of making, a flat per-piece hallmarking fee, or a different making percentage than you'd assumed. Always ask for an itemised invoice and compare line by line.
What is BIS hallmarking?
BIS Hallmark is the government-mandated purity stamp for gold jewellery in India, required on every piece sold since 2021. It encodes the karat purity, the BIS logo, the assay centre code, and the jeweller's identification mark. Hallmarking costs a flat ~₹45 per piece, regardless of weight.
Why is GST 3% on gold in India?
GST on gold jewellery in India is 3%, applied to the gold value plus making charges. It's mandatory on every retail purchase. The calculator includes it by default in INR mode and hides it in other currencies.
How much loan can I get against gold in India?
The maximum loan depends on the fine-gold weight of your jewellery, the IBJA reference rate on the day you pledge, and the RBI's April 2026 tiered LTV directive: 85% up to ₹2.5 lakh, 80% for ₹2.5-5 lakh, 75% above ₹5 lakh. The tier is decided by the loan amount, not the collateral value — so a ₹3 lakh collateral piece caps at 80% (₹2.4 lakh), not 85%.
What is the RBI April 2026 gold loan directive?
The Reserve Bank of India's April 2026 directions on lending against gold and silver collateral set standard LTV caps for all regulated lenders — banks and NBFCs alike: 85% for loans up to ₹2.5 lakh, 80% for ₹2.5-5 lakh, 75% above ₹5 lakh. Lenders must use the IBJA reference rate for valuation, and can consider only the fine-gold content of the piece (stones, beads and thread must be deducted).
Which rate do banks and NBFCs use to value gold for a loan?
The IBJA (India Bullion and Jewellers Association) reference rate for 999 fine gold is the mandatory benchmark under the RBI directive. Lenders convert your piece's gross weight to pure-gold weight using its karat (22K = 91.6%) and multiply by the IBJA rate to arrive at the collateral value. That value, times the tier LTV, is your maximum loan.
How do bank and NBFC gold loan rates compare?
Banks — SBI, HDFC, ICICI, Kotak, Axis, Federal — typically charge 9.5-14% per annum on gold loans. NBFCs like Muthoot Finance, Manappuram, IIFL and Rupeek charge 12-24%, but disburse faster (sometimes within an hour). Under the RBI 2026 directive, both apply identical LTV caps; interest rate, processing fee and disbursement speed are where they compete.
What happens to my gold if I can't repay?
Gold loans are secured against the pledged jewellery. If you default, the lender is legally entitled to auction the collateral to recover their dues — usually after multiple demand notices spread over 60-90 days. Any surplus after settling the loan, interest and charges is returned to you, but you lose the piece. Never pledge jewellery you can't afford to lose.
Are stones and beads counted in the loan valuation?
No. Lenders assess only the gold content. Stones, beads, thread, kundan work and enamel are deducted from the gross weight before the collateral is valued — either by weighing them separately or by applying a percentage estimate (usually 10-25% depending on the piece). Heavy bridal work can lose a third of gross weight to inclusions.
What is the maximum tenure for a gold loan?
Most gold loans run between 3 and 36 months. Banks offer longer tenures (up to 36 months); NBFCs often prefer shorter ones (3-12 months) with faster turnover. Interest may be paid monthly or as a bullet at closure, depending on the product structure — the "overdraft" variants are typically cheaper if you're disciplined.
Do gold loans need a credit-score check?
Gold loans are secured, so most lenders don't require a formal credit check. Banks may still pull a credit report to size the loan or set the interest rate; NBFCs often skip this step for smaller loans. The pledged gold, not your credit profile, is the primary security — which is why gold loans are one of the easiest options for people with no credit history.