Bank of Maharashtra (BOM) Gold Loan is for personal expenses as well as agricultural activities. You can pledge gold jewellery/ornaments and avail of funds up to Rs. 20 lakhs. The loan comes to the rescue during financial emergencies such as medical contingency, higher education, marriage, big-ticket purchase, travel, etc. Individuals in the age group of 18-70 can apply for a loan against gold. The tenure is flexible and as per your repayment capacity. You can choose from different repayment modes.

In this post, we will discuss BOM gold loans features, interest rates, types of schemes and their details, and frequently asked questions.

Features of Bank of Maharashtra Gold Loan

Here are the features of BOM loan against gold:

• Minimum documentation is required for the loan application. You have to submit a government-recognized identity proof and address proof, along with the filled and signed loan application form and your passport-sized photograph.
• Any individual who is an adult can apply for the funds. Elderlies till the age of 70 (till loan maturity) can avail of this facility.
• You can borrow up to 75% of the gold’s market value or up to Rs. 20 lakhs. For agriculture purposes, the loan amount under the interest subvention scheme is up to Rs. 3 lakhs.
• The interest rate is linked to the repo rate and starts at 7% for agriculture schemes and 7.35% for standard gold loan schemes.
• Self-owned gold jewellery is preferred as collateral. All other forms of gold are not acceptable to pledge with the bank.
• You can choose a repayment scheme based on monthly interest + principal payment or interest payment at the end of tenure with principal payments every month.

Bank of Maharashtra Gold Loan Interest Rate

For the Maha Gold loan scheme, which is a retail gold loan facility, the rate of interest starts at 7.35%. This is based on Repo Linked Lending Rate (RLLR). The current interest rate is RLLR + 0.45%. For gold loans related to agriculture and allied activities, the rate is fixed at 7% onward under the interest subvention scheme. The rate is according to 1-year MCLR for cash credit facility for allied activities and term loans.

The gold loan interest rate otherwise depends on the following factors:

• Loan to value ratio (up to 75% of the current market value of gold)
• Net weight of the pledged asset
• Purity of the gold jewellery
• Purpose of the loan
• Terms and conditions of the bank

Types of Bank of Maharashtra Gold Loans

Here are the two popular loans against the gold scheme by BOM:

1. Maha Gold Loan Scheme

This is a cash credit/term loan facility. The purpose of the loan is to serve the requirements of people to meet personal expenses. These needs may include funds for higher education, wedding, medical contingencies, business travel, and more. You have to specify the end-use of the funds with an undertaking that you will not utilize the loan for any speculative purposes.

• Eligibility: All individuals over 18 years of age, including the bank staff, can apply for this loan facility. The loan is against gold jewellery or ornament. The applicants have to fulfil the KYC guidelines.
• Collateral: The bank accepts gold jewellery and ornaments as collateral. It will not provide a loan against gold bullion or any other forms of this precious metal.
• Loan Amount: The scale of finance is reviewed regularly. The eligible loan limit is up to 75% of the gold’s market value and net weight of the asset, excluding any other precious metal/stone attached to the pledged jewellery.
• LTV: The loan to value ratio (LTV) is maintained as up to 75% in all types of gold loans throughout the tenure.
• Tenure: The tenure for the bullet repayment scheme is up to 12 months. Tenure for other BOM gold loans is up to 24 months.
• Interest Rate: The rate is 7.35% onward. It is RLLR + 0.45. The interest rates change from time to time depending on the bank’s discretion.
• Rate Per Gram: The rate per gram of 22-carat gold jewellery is Rs. 3,065. This value may change as per the bank’s discretion based on the current rate of the asset.
• Margin: The margin retained by the bank is 35% in the case of bullet repayments. In other cases, the margin retained is 25%.
• Repayment for Term Loans: Repayment mode for term facility is of two types. Firstly, you can choose the EMI scheme. Here, you have to pay the principal borrowed within 24 months. The repayments are fixed in terms of quarterly, monthly, half-yearly, or yearly. In a Term Loan Facility, the interest is charged every month, and must be calculated as when applied.
• Bullet Repayments: In the Bullet Repayment scheme, the interest is charged on monthly basis. But you can pay the interest at the end of the loan tenure. Before this, you need to pay the principal promptly.
• Cash Credit: For Cash Credit gold loans, there is an annual review for the amount you pay once a year. The interest is applied monthly.
• Charges: Packing charges or out-of-pocket expenses is Rs. 100 + GST. The processing fee is Rs. 500 per loan application + GST. There are no charges for inspection and documentation.

2. Mahabank Gold Loan – Agriculture

The Bank of Maharashtra Gold Loan for agriculture is for farmers. They can fulfil requirements regarding cash credit for allied agricultural activities or crop production. The funds are also available for investment credit. The cash credit for crop production is in the form of MKCC. For term loans, the eligibility is any individual who participates in agriculture or allied activities. The person must satisfy the KYC guidelines.

• Security: You have to pledge gold jewellery and ornaments. BOM does not accept bullion or any other forms of gold as collateral.
• Margin: For MKCC and Agri cash credit against gold, the minimum margin is 25% of the asset’s market value. The margin for term loan against gold is at least 40% of the asset’s market value.
• Loan Amount: The scale of finance is according to the crops for MKCC against gold. The cash credit against gold is according to your fund requirement. The same is true for an agriculture term loan. The loan amount eligibility is as per LTV of up to 75% of the gold’s current value for cash credit and MKCC.

  The loan to value ratio is up to 60% of the gold asset for a term loan, or as per gram rate of Rs. 3,065 for 22-carat gold, whichever is lower. The maximum quantum of finance is up to Rs. 3 lakhs for MKCC. The maximum amount you can borrow otherwise is up to Rs. 20 lakhs per applicant.

• Interest Rate: For MKCC, the fixed interest rate per annum is 7%. This is for loans up to Rs. 3 lakhs under the interest subvention scheme up to a year. The rate is as per the 1-year MCLR for cash credit allied activities. The same is applicable for term loans.
• Repayment: The repayment for MKCC is as per the scheme guidelines. The repayment terms for CC allied activities are based on an annual review. For term loans, the repayment is within 60 months based on the end purpose of the loan.