Gold Loan Limit, LTV and Tenure: RBI Rules Explained

The RBI caps a gold loan at 85% of your gold’s value when your total gold loans are ₹2.5 lakh or less, 80% up to ₹5 lakh and 75% above that. Bullet-repayment gold loans taken for personal use can run for at most 12 months, while EMI and overdraft gold loans at SBI and PNB run for up to 36 months.

These limits come from the Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025, which lenders had to follow by 1 April 2026. Loans taken before a lender adopted the new rules stay under the old ones.

Gold loan rules at a glance

The directions apply to banks, small finance banks, regional rural banks, co-operative banks and all NBFCs, including housing finance companies. They do not apply to payments banks.

What LTV means in a gold loan

LTV, or loan-to-value ratio, is your outstanding loan divided by the value of the gold you pledged. A lower LTV means the lender holds more gold than it has lent, which protects it if gold prices fall.

The RBI’s tiered caps apply to consumption loans, meaning loans for personal needs such as a wedding or medical bill. For loans taken for farming or business, the lender’s own board-approved policy sets the maximum LTV.

Two rules decide how the ratio is worked out:

• The tier depends on all your gold loans with that lender. The ₹2.5 lakh and ₹5 lakh limits apply to your total consumption gold loans, not to each loan separately.
• Bullet loans count the maturity amount. For a loan where you repay principal and interest together at the end, the lender takes the total amount due at maturity, not the amount you receive.

The lender must keep the loan within the cap for its whole term. If gold prices fall and your LTV rises above the limit, expect a request to repay part of the loan or pledge more gold.

How much gold loan you can get

Lenders value your gold at the lower of two prices for its purity: the average closing price over the previous 30 days, or the previous day’s closing price. The price must come from the India Bullion and Jewellers Association (IBJA) or a SEBI-regulated commodity exchange. Only the gold content counts, so stones, lac and fastenings are deducted from the weight. For today’s prices, see our gold rate today page.

The RBI cap is the ceiling. Most banks lend less by keeping a margin, as the table shows.

Under the RBI cap alone, gold worth ₹1,00,000 could support a loan of up to ₹85,000. Bank of Baroda’s gold loan calculator uses LTVs of 65% for bullet loans, 70% for demand loans, 75% for EMI loans and 80% for farm gold loans.

Bullet loan example. Say you want ₹2,00,000 for 12 months at SBI’s 9.15%. The amount due at maturity is roughly ₹2,18,300. To stay within the 85% cap, the gold must be worth at least about ₹2,56,800, and SBI’s 35% margin means it will ask for more.

Gold loan limits: minimum and maximum amount

The RBI does not set a rupee minimum or maximum. It limits the amount through the LTV cap and the weight rules, and each lender sets its own range.

SBI asks for income documents on loans above ₹2.5 lakh, in line with the RBI’s requirement to assess repayment capacity above that amount.

Gold loan tenure and repayment period

The RBI fixes only one tenure limit: 12 months for bullet-repayment loans taken for personal use. The lender may renew such a loan if you pay the accrued interest first, the loan is within the LTV cap and the account is standard. Lenders set the tenure of other gold loans themselves.

Bank of Baroda’s calculator also allows up to 36 months. Before choosing a long EMI term, work out the total interest with the EMI calculator.

Gold loan interest rates and fees at three banks

PNB also charges the gold appraiser’s fee of ₹5 per ₹1,000, between ₹500 and ₹1,200. SBI has no prepayment or foreclosure charge on its gold loans. For more lenders, see our gold loan interest rates page.

Your rights when you pledge gold

1. Be present when the lender tests your gold, and ask it to explain every weight deduction.
2. Collect the assay certificate, which must state purity, gross and net weight, deductions, any damage, a photo and the value.
3. Read the loan agreement and Key Fact Statement, which must list all charges, including assaying and auction costs, and the notice period before any auction.
4. On full repayment, collect your gold the same day or within 7 working days. If the lender causes a delay, claim ₹5,000 for each extra day.
5. If the loan goes unpaid, the lender must send you notice before auctioning your gold. It must hold the auction in the same district first and advertise it in two newspapers.
6. After an auction, the lender must show you the sale value and refund any surplus within 7 working days.

The reserve price at an auction must be at least 90% of the gold’s current value, or 85% after two failed auctions. The lender and its related parties cannot bid. Our guide to borrower rights covers recovery rules and complaints.

Frequently asked questions

What is the maximum LTV for a gold loan as per RBI?

85% when your total gold loans are up to ₹2.5 lakh, 80% above ₹2.5 lakh up to ₹5 lakh, and 75% above ₹5 lakh. These caps apply to consumption loans from 1 April 2026.

What is the maximum tenure for a gold loan?

A bullet-repayment gold loan for personal use can run for up to 12 months. EMI and overdraft gold loans at SBI and PNB run for up to 36 months.

Is there a gold loan limit on how much gold I can pledge?

Yes. Across all your loans, you can pledge up to 1 kg of gold ornaments and up to 50 grams of gold coins.

Can I get a gold loan against gold bars or gold ETFs?

No. The RBI bars loans against primary gold such as bars and biscuits, and against gold ETFs or gold mutual fund units.

Is the LTV in a bullet gold loan calculated differently?

Yes. The lender uses the total you will owe at maturity, principal plus interest, so you get less cash than an EMI loan on the same gold.

How soon must the bank return my gold?

On the day you repay in full, and within 7 working days at most. If the lender causes a longer delay, it pays you ₹5,000 for each day.

Do I need a credit check for a gold loan?

Lenders may use a lighter check for small loans. A detailed assessment of your repayment capacity is required once your total gold loans exceed ₹2.5 lakh.

Sources

• Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025, updated 29 September 2025 — Reserve Bank of India (checked 17 Sep 2026)
• Personal Gold Loans — State Bank of India (checked 17 Sep 2026)
• Scheme for Advance Against Gold Jewellery/Gold Ornaments — Punjab National Bank (checked 17 Sep 2026)
• Digital Gold Loan — Punjab National Bank (checked 17 Sep 2026)
• Interest rates on advances (RLLR) — Punjab National Bank (checked 17 Sep 2026)
• Retail loans interest rates — Bank of Baroda (checked 17 Sep 2026)
• Gold loan eligibility calculator — Bank of Baroda (checked 17 Sep 2026)