Overdraft Gold Loan: Deposit gold in the bank and get money when needed. Know the features of Overdraft Gold Loan..

Overdraft Gold Loan: Rising gold prices and increasing demand have made gold loans a viable option. Under a gold loan, you can borrow money from the bank based on your needs. Banks offer two types of loans against gold: gold loans with overdraft facilities and gold loan EMI options. In this article, we'll explore the features of gold loans with overdraft facilities.

With an overdraft gold loan, your gold is pledged with the bank or financial institution. In return, you receive an overdraft account, which holds an amount equal to your loan amount. You can withdraw funds from this account whenever needed.

You can withdraw money from ATMs using a debit card.

You can also withdraw funds through checks.

Some lenders also offer online shopping and payment facilities.

Overdraft gold loans only charge interest on usage.

Traditional EMI gold loans require you to borrow the entire amount in one go and pay the full interest. Whereas, with an overdraft gold loan, you can withdraw as much as you want, and interest is charged only on the amount withdrawn.

Gold Loan EMI vs. Overdraft Gold Loan
Gold Loan EMI: In this case, you receive a lump sum amount and pay EMIs on it. If you need less money now and more later, you may have to take out a new loan.

Overdraft Gold Loan: This offers greater flexibility. You can withdraw money from your credit limit repeatedly. For example, if your limit is Rs 5 lakh, you can withdraw Rs 1 lakh or the entire amount at any time. Interest is charged only on the amount withdrawn, not on the entire credit limit.

Disclaimer: This content has been sourced and edited from News 18 hindi. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.