Union Bank Gold Loan Interest Rates

Gold loan interest rate Union Bank is either linked to MCLR (Marginal Cost of Funds Based Landing Rate) or EBLR (External Benchmark-based Lending Rate). The EBLR of Union Bank of India from 11.08.2022 is 8.20% (i.e. RBI Repo Rate 5.40% + Spread 2.80%), and 1-year MCLR from 11.09.2022 is 7.75%. 

The Union Bank of India gold loan interest rate today w.e.f 04.05.2022 are mentioned below in detail: 

Below is the comparison of the Union Bank gold loan interest rate with other lenders. You can check the interest rates of top gold loan providers to see which is the best gold loan bank in India before you apply for the loan.

Following are some attractive features of Union Bank gold loan:

• Purpose: You can avail of Union Bank of India gold loan for agriculture (farming or allied agricultural activities), day to day working capital requirement of a business, petty trade, purchase of business equipment, furnishing of business premises, furniture purchase, fixtures, or any unforeseen expenses like medical treatment, marriage, education, and so on. 
• Maximum loan amount: You can avail of a maximum loan amount of Rs. 20 Lakhs for priority sector loans, including agriculture purposes and Rs. 25 Lakhs for non-priority sector loans.
• Nature of facility: Union Bank of India loans against gold ornaments can be availed of in the form of Union Green Card with an operative limit of up to 5 years, Cash Credit (Pledge), Short Term Crop Loan, Secured Overdraft, Demand Loan or Term Loan to be repaid in instalments with tenure up to 3 years.. 
• Rate of interest: The Union Bank gold loan interest rate varies between 7.75% and 8.90% per annum, depending on the loan type, amount, gold rate today and other factors. 
• Processing fees: The bank will charge a processing fee on the sanctioned loan limit as per the extant guidelines.
• Repayment tenure: 
  • Agriculture: The repayment tenure can be fixed as per the anticipated harvesting and marketing period of the crops for which the loan is granted. For a demand loan, repayment should be fixed depending on the income generation based on the harvest and marketing time, with total tenure not exceeding 18 months. For a term loan, the loan tenure should be fixed according to the loan purpose but not exceeding 3 years coinciding with the harvesting and marketing season or generation of income from the activity.
  • Non-agriculture: For non-agricultural purposes, tenure of loans should not exceed 12 months from the date of sanction.

Following are the two types of Union Bank of India gold loans and their key features mentioned in detail:

Gold Loan Scheme

• Purpose: 
  • Agriculture: This loan can be used for meeting crop production expenses, creating assets to be used in the farming operation, or allied agricultural activities like dairy, poultry, fisheries, and other agriculture-related activities.
  • Business: The loan can be used for the day-to-day working capital requirements of a business unit, petty trade, purchasing business tools, furnishing of business premises, purchasing furniture, fixtures, etc.
  • Consumption: These loans are sanctioned to meet unforeseen expenses/contingencies, expenses for medical treatment, marriage and other ceremonies expenses, education or business needs. 
• Eligibility
  • Union Bank gold loan eligibility criteria are simple. Any individual who owns gold ornaments, jewellery, or coins, either singly or jointly, is eligible.
  • Jewellers, jewellery shop-owners, and pawnbrokers are not eligible for Union Bank gold Loan.
  • These loans can be availed of against gold ornaments, jewellery and specially minted pure gold coins that are sold by Union Bank of India or other banks. 
  • The weight of the gold coin(s) should not exceed 50 grams per customer.
• Assessment of loan amount: Whichever is lower from the options mentioned below:
  • 75% of the appraised value of 22-carat gold ornaments 
  • Amount eligible based on the gold’s per gram rate fixed by the bank for 22-carat fineness.
  • Amount assessed based on the scale of finance for crop production/ actual amount of credit required for other than crop production, as the case may be.

• Nature of facility: Loans against gold ornaments can be offered in the form of Union Green Card with an operative limit of up to 5 years, Cash Credit (Pledge), Short Term Crop Loan, Demand Loan, Secured Overdraft, or Term Loan repayable in tenure up to 3 years.
• Maximum loan amount:
  • Maximum Rs. 20 Lakhs for priority sector loans, including agriculture purposes.
  • Maximum Rs. 25 Lakhs for non-priority sector loans.
• Repayment tenure: 
  • Agriculture purposes: Fixed as per the anticipated harvesting & marketing period for the crops for which the loan is granted. For demand loans, total tenure should not exceed 18 months. For term loans, the repayment tenure should not exceed 3 years coinciding with the harvesting & marketing season or generation of income from the activity.
  • Non-agriculture purposes: maximum tenure should not exceed 12 months from the date of sanction.

• Rate of interest: Union Bank gold loan interest rate ranges from 7.75% to 8.90% p.a.. 
• Processing fees: As per the extant guidelines.

Union Krishi Kamdhenu Gold Loan Scheme

• Purpose: To provide hassle-free credit for farmers to help them meet their emergency requirements for income-generating agriculture & allied activities and food & agro-processing activities.
• Eligibility: 
  • Any individual who owns gold ornaments, jewellery, or coins, either singly or jointly, is eligible.
  • These loans can be availed of against gold ornaments, jewellery and specially minted pure gold coins that are sold by Union Bank of India or other banks. 
  • The weight of the gold coin(s) should not exceed 50 grams per customer.
  • The identity and address of the applicant should be established by verifying their ration card/ identity card/ passport/ aadhaar card/ PAN card or any similar documents as acceptable by the bank. 
• Assessment of loan amount: Whichever is lower from the options mentioned below:
  • Loan amount requested by the applicant or assessed amount on the declaration.
  • 80% of the appraised value of 22-carat gold ornaments 
  • Amount eligible based on the gold’s per gram rate fixed by the bank for 22-carat fineness. Daily price data and the gold loan rate per gram today will be taken from the link created in UBINET.
• Maximum loan amount:
  • Maximum Rs. 5 Lakhs per borrower for agriculture, allied activities and food & agro-processing activities.

• Margin: Minimum 20%.
• Nature of facility: Loans against gold ornaments can be offered in the form of a Demand Loan.
• Repayment tenure: The loan can be repaid in a lump sum or part payments, but the loan has to be repaid within a tenure of up to 12 months.
• Rate of interest: Union Bank gold loan interest rate is 1-year MCLR, i.e. 7.75% at present.
• Service charges: Nominal charges of Rs. 100
• Appraisal charges: 0.40% of the loan amount, subject to a minimum of Rs. 100 and a maximum of Rs. 500 per case.

Currently, the Union Bank of India's gold loan rate per gram today is Rs. 2,900 to Rs. 3,450. The rates are subject to change and depend on the loan amount, gold’s value, tenure of the loan and other factors.

Union Bank bank gold loan calculator can be used to borrow money from the bank in the form of a gold loan. The tool is very useful and helps the borrower to plan their budget according to the estimated EMI. The gold loan calculator will calculate the amount of EMI that you will need to pay for the gold loan amount that you have borrowed. You can try on different combinations of various rates of interest and tenures that are offered by the bank to make sure that you get the best option available.

Following are the fees and charges associated with the Union Bank of India gold loan:

• Rate of interest: Union Bank gold loan interest rate varies between 7.75% to 8.90% p.a.
• Processing fee: As per the extant guidelines.
• Service charges: Rs. 100; applicable for Union Krishi Kamdhenu Gold Loan Scheme.
• Appraisal charges: 0.40% of the loan amount for Union Krishi Kamdhenu Gold Loan Scheme; maximum Rs.500 and minimum Rs. 100  per case.

You can apply for the Union Bank of India gold loan from the comfort of your home. You can either do it online or by visiting the bank’s official website and submitting an application form with basic information about yourself and the loan you wish to avail of.