About the gold loan calculator
Estimate the maximum loan you can raise against your jewellery under the RBI April 2026 tiered LTV directive. The math is fine-gold weight × the Indian spot rate × the applicable LTV ceiling — and this page walks you through what each of those actually means before you walk into a branch.
How the RBI April 2026 directive works
The Reserve Bank's April 2026 directions standardised gold loan lending across all regulated lenders — commercial banks, small finance banks, NBFCs. Three tiers apply, decided by the loan amount rather than the collateral value:
- Loans up to ₹2.5 lakh — maximum 85% LTV
- Loans between ₹2.5 lakh and ₹5 lakh — maximum 80% LTV
- Loans above ₹5 lakh — maximum 75% LTV
The tier is the tier the loan falls into. A ₹3 lakh collateral piece caps at 80% LTV giving you ₹2.4 lakh — not 85% of ₹3 lakh, which would exceed tier one's cap.
What lenders actually assess
Every RBI-regulated lender uses the IBJA reference rate for the collateral valuation and can consider only the fine-gold content of your piece. Stones, beads, thread and enamel are deducted from the gross weight before the metal is valued. A heavy bridal piece with 30% inclusion weight will value at 70% of its gross grammage — a fact your ancestral kundan collection is going to teach you the hard way at the branch.
Purity assessment happens at the branch. Banks typically use a purity meter or touchstone; NBFCs often use an X-ray fluorescence scanner. Hallmarked pieces move faster through the process.
Banks vs NBFCs — what changes
Banks (SBI, HDFC, ICICI, Kotak, Axis, Federal): interest range 9.5–14% p.a., slower disbursement, more paperwork, lower rates. Typical tenor 12–36 months.
NBFCs (Muthoot Finance, Manappuram Finance, IIFL Finance, Rupeek): interest range 12–24% p.a., same-day disbursement, less paperwork, higher rates. Typical tenor 3–12 months.
Both apply the same RBI LTV ceilings — the calculator's answer is the ceiling for both. What differs is what you pay to borrow against that ceiling and how quickly the money reaches you.
What this calculator won't tell you
- Individual lenders can (and do) offer less than the RBI maximum. Credit profile, tenor and existing relationship shape the actual offer.
- Interest rate depends on the lender, the tenor and your profile. This tool is a valuation calculator, not a lender comparison.
- Foreclosure charges and prepayment penalties vary by lender. Ask about them before you sign, not after.
- The Indian spot rate used here tracks the IBJA reference rate within 1–2% — not to the paisa. Your lender's own valuation may differ slightly.
For household record-keeping: MyAurum lets you record pledged pieces alongside your unencumbered gold, so you always know what's collateralised and what's free. Nominees see the same picture. Estate conversations shorten by a factor of ten.
About the SGB calculator
Value your existing Sovereign Gold Bond holdings against today's Indian spot rate. See interest earned to date, project the eight-year redemption at maturity, and compare your total return to the same weight in physical gold.
What SGBs are
Sovereign Gold Bonds are government-issued securities denominated in grams of gold. One SGB unit equals one gram. Issued by the Reserve Bank between 2015 and 2024, SGBs carry three defining features:
- A fixed 2.5% p.a. interest coupon paid semi-annually on the issue price
- Eight-year tenor with an exit option from year five onwards
- Tax-free capital gains at maturity — the government-favoured feature that materially beats physical gold's 20% LTCG treatment after 24 months holding
Why RBI stopped new issuance
The Reserve Bank discontinued new SGB tranches after the 2023-24 series. Gold prices had appreciated significantly during the issuance window, and the scheme's redemption liability (which is linked to prevailing gold rates) had become increasingly expensive for the sovereign to service. Existing bonds continue as scheduled: each pays its coupon until maturity, and each redeems at the average IBJA rate of the last three business days before its own maturity date.
Approximately 200 crore SGB units remain outstanding across all tranches, held by individual investors, HUFs and trusts. This calculator is built for those holders.
How the interest math works
Interest is calculated on the issue price of your tranche, not on today's gold rate. For a 10-unit holding bought at ₹5,000 per gram:
- Issue value — 10 × ₹5,000 = ₹50,000
- Annual interest — 2.5% × ₹50,000 = ₹1,250
- Paid semi-annually — ₹625 every six months
- Cumulative over the eight-year tenor — ₹10,000
That's on top of the underlying gold's appreciation between the day you bought and the day RBI redeems.
The scenario slider
Under the maturity projection card, a slider lets you drag the gold rate at redemption from -25% to +50% of today's Indian spot rate. Because maturity is set by future gold prices — which no one can predict — the slider gives you the outcome cone rather than a false single-point forecast. Numbers below the slider recompute as you drag.
Tax treatment
- Interest income — taxable at your slab rate each year the coupon is credited
- Capital gains at eight-year maturity — fully exempt from income tax
- Premature exit (year 5-7) or secondary-market sale — taxed as normal LTCG / STCG; the exemption is lost
The maturity exemption is why SGB has been the mathematically superior instrument for long-hold gold allocations, for holders willing to lock in for eight years.
Selling before maturity
- Secondary market — SGBs trade on NSE and BSE. Liquidity is typically thin and secondary-market prices often sit 5–15% below intrinsic value, so this is a discount route unless you're desperate
- RBI premature exit — allowed at end of year 5, 6, or 7; you receive the 3-day average IBJA rate at that point
- Both routes lose the capital-gains exemption; interest already received stays yours
For household record-keeping: MyAurum lets you record each SGB tranche individually, with issue date and maturity date recognised — so upcoming interest payments and eight-year redemptions surface as to-dos rather than surprises.
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.
Sovereign Gold Bonds, plain-spoken — how they pay, how they mature, and how they compare to physical gold.
What is a Sovereign Gold Bond (SGB)?
A government-issued security denominated in grams of gold. One SGB unit = one gram. Issued by RBI between 2015 and 2024, SGBs pay a fixed 2.5% p.a. interest on the issue price (semi-annually) and redeem at the prevailing gold rate at maturity (8 years). Existing bonds continue to trade and pay interest, even though RBI discontinued new issuance after the 2023-24 series.
How is SGB interest calculated?
2.5% per year on your issue price, not on today's gold rate. Paid semi-annually to your registered bank account. Example: 10 units bought at ₹5,000 per gram = ₹50,000 issue value → ₹1,250 per year → ₹625 every six months. Held for the full 8-year tenor, that's ₹10,000 in cumulative interest on top of the gold's own appreciation.
What is the tax treatment at maturity?
Capital gains on SGB redemption at maturity are fully exempt from income tax — the government-favoured feature that materially beats physical gold's 20% LTCG (with indexation) after 24 months. Interest income is taxable at your slab rate each year. Premature exit or secondary-market sale loses the exemption and follows normal LTCG / STCG rules.
Can I sell SGB before maturity?
Yes, two routes. (1) RBI allows premature exit at the end of the 5th, 6th and 7th years — you get the 3-day average IBJA rate at that point. (2) SGBs trade on NSE and BSE, so you can sell into the secondary market any time, though liquidity is thin and secondary-market prices often trade at a discount to intrinsic value. Both routes lose the capital-gains exemption; interest already received stays yours.
Why did RBI stop issuing new SGBs?
Cost. The government cited that SGBs had to be redeemed at market gold rates, and gold appreciated significantly during the issuance period — making the scheme expensive for the sovereign. New tranches were discontinued after the 2023-24 series. Existing bonds continue as scheduled: interest is paid, and each matures at its own 8-year mark. If you already hold SGBs, nothing changes.
How does SGB compare to physical gold?
Three real advantages for SGB: 2.5% annual coupon (physical gold has none), tax-free capital gains at maturity (physical is 20% LTCG), no storage / insurance / making charges. Physical gold's advantages: liquidity, cultural utility (jewellery, gifting, ceremonial use), and no counterparty risk beyond the sovereign. For pure investment allocation, SGB has been mathematically superior for holders willing to lock in 8 years.
How is SGB redeemed at maturity?
At the 8-year mark, RBI redeems each SGB at the average IBJA reference rate of the last 3 business days before maturity. The redemption amount lands in your registered bank account — no action needed from you. You'll receive an intimation from RBI a few weeks before your maturity date.