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INTRODUCTION
According to a recent estimate by the World Gold Council, there is around 18,000 tonnes of gold lying with individuals in India and as much as 65 per cent of India’s gold lies with people in rural areas. Indian households have been buying gold for generations for socio-cultural, religious and economic reasons. Gold is a store of value and hedge against inflation. With gold prices zooming, borrowers have discovered that they can raise more money with the same collateral. With gold loans, small individual players have superseded those in the big cities to leverage their possession of gold jewellery to avail quick loans for businesses.
Till a few years back, gold loans were the last resort for borrowers but the scene is fast changing with more jewellery owners viewing it as an asset to get smart loans. With the entrance of non-banking financial companies
(NBFCs) in the picture, loan against gold has become all the more popular. Gold loans are amongst the newest class of assets which have seen rapid growth in securitisation. The government views gold loans as an effective means of meeting the de
mand for micro-finance in India. Gold loans have become a basis for creation of new financial products such as loans for purchase of gold wherein gold is purchased on the date of loan and held as a pledge until the equated monthly instalments are paid. The present paper tries to gain an understanding about the Indian gold loan market and also tries to know the attitude of the customers towards the gold loans. The paper utilises both primary and secondary sources for collecting the data. To know the attitude of the customers, information has been collected from 80 respondents. India is one of the biggest markets for gold and gold loan. Indian households typically have an emotional attachment and sense of personal belonging to the gold they own, which is usually in the form of jewellery, coins or bars. According to the World Gold Council, India accounts for 10 per cent of world’s total gold stock, of which rural India accounts for 65 % per cent of the total gold stock. Gold jewellery provides immense consumer satisfaction and also serves as an appreciating asset—a rare, socially valuable combination. There has been a high demand for gold in India, irrespective of prices. During 2001-12, the annual demand for gold remained relatively stable at around 700 to 900 tonnes despite constant rise in prices during the last ten years. Though gold is a highly liquid asset, it was not until recently that consumers leveraged it effectively to meet their liquidity needs. With gold prices zooming, borrowers have discovered that they can raise more money with the same collateral. Lenders provide loans by securing gold assets as collateral. Compared with the rest of the world, in India the gold loan market is a big business. Traditionally, gold loans were provided only by informal market players, however, over the last few decades, there has been a considerable shift in this scenario as a pool of specialised financial institutions called NBFCs have emerged catering to the financial needs of low-income households. Gold loan is a simple modification of the age-old practice by money lenders and has been institutionalised by the banks now. In this loan, one has to deposit the household gold in the form of jewellery with the bank or financing agency and get a loan up to 60 per cent of the gold deposited. It requires proper documentation such as submission of election card/Aadhar card as identity proofs and PAN cards for income proof.
Statement of problem
The value of gold has been on the rise for the last century uninterrupted and is currently touching unprecedented heights. Thus, it makes sense to utilise the power of the gold
lying in lockers to avail loans instead of paying higher interest rates for pure personal loans. With banks and other financial institutions entering this space of late, there has been a marked increase in personal loans against gold amongst the Indian middle class.
Introduction to the gold loan:
Banks/NBFC's provide loan and asks for the security from the person willing for the loan. Minimum of paperwork and a person receive the money immediately. The security asked for is the gold that the individual applied for, owns. This is the collateral asked for by them. The funding institutions provide a loan amount of up to 85% of the market value of the gold at the particular time. Also the interest rates are also affordable as compared to other loans. A gold loan is a loan in which money is provided to the loan applicant on the basis of the quality of the gold that the person owns. An added advantage of these Loans is that the person applying for these loans can even have a poor credit score. The banks do not ask for the income proofs or the previous credit history of the customer. For more information on
Importance of Gold Loan
Loans in today’s world are occupying a pivotal position. Every individual wishes to buy several things and amenities but that it is not possible in all cases. The expenses are too high, and the income of the people is the same. Inflation is at its peak, but the income level has remained the same. Due to this, there is a lot of pressure on the breadwinner of the family as he is responsible for carrying the burden of all the expenses of the family.
Due to such reasons, Loans have become the solutions for all these issues. There are many kinds of loans available in the market. The idea of loans is basically designed for the people who wish to buy several things but can’t afford them. One of these types of loans is gold loan.
These are loans that are given on gold. In other words, gold is pledged as collateral by the borrower for a particular sum of money.Most of the people who buy gold as an investment for future purposes. It is the most beneficial for people who need a loan for instance financing. When loans are available on gold, it becomes very easy for the borrower to apply for them as he doesn’t need to go for long procedures or verifications. There are manyFeatures of Gold Loans that are available for the person to avail.
The best thing about gold loans is that they are easily available in the market. That is, all the banks and financial institutions give such loans to people. The provision of the loan is solely on the discretion of the banks. By taking gold loans, one can maintain liquidity in his finance, without selling off any asset or the gold itself. Gold works as a security for getting a required amount of finance from any bank. The most attractive part of these loans is that the loan is given for an amount which is more than 80% of the value.
Unlike other loans, there are many Benefits of Gold Loans. These loans are also termed as ‘ATL’ which means anytime liquidity. This means that the person can get the loan in less than 30 minutes easily and quickly. The most tedious thing that people feel about taking a loan is that it is a very long process and requires a lot of documentation. But this is not the case with gold loans. There is very less documentation and also the paperwork is very simplified.
The most highlighting thing is that you are not supposed to pay any EMI; you just have to service the interest and benefit from these loans. And also, the loan is given in a very short time. I mean you just have to apply for the loan and you get the money in a few hours. So, if you are a working individual and you require a quick loan, gold loan is the best option for you. It is no more harassing for the person to get a loan.
The first thing that bothers people before taking a loan is the interest rate. This is because one is supposed to pay the asked amount of interest during the repayment. When you apply for Gold loan you should be least bothered about the interest. The Gold Loan Interest Rate that is charged on the gold loans is very less. So even if you do not have a long repayment period but a low rate of interest, the option becomes an acceptable one. In comparison to personal loans and other categories of loans, the rate of interest in case of gold loans is the least. This makes gold loans the most preferable and the rational choice of the masses.
Also, the funds derived from gold loans can be used for all purposes. There is no usage restriction like that of home loans, education loans, Auto loans etc. All these reasons make a gold loan a very attractive deal for the borrower.
Features of Gold Loan:
You can avail Loan up to Rs.1 Crore or more & up to 70% of value for any purpose
You get 100% Safety & Security of your Gold Jewellery
Get your Loan processed in less than 30 minutes
Enjoy Anytime Liquidity.¬¬¬
No EMI, Service only Interest and enjoy the Loan facility
Lower Interest Rates
Simple documentation and fast processing.
Overdraft limit varies depending on the market rate of gold.¬
Interest rate is payable only amount of the overdraft that you use.
advantages of gold loans
If only people would fall back on their savings in the form of gold, and borrow money at reasonable rates of interest against the pledge of their gold ornaments, the debt-trap can be curbed to a large extent. Yet it does not happen because we are all emotionally attached to our gold jewellery and, even in these more permissive times, there is a stigma attached to pledging gold to borrow money. In fact, it is considered a sign of desperation so that when people borrow against gold, they don’t want their neighbours to know of it. And so, the reality is that rather than use their gold to raise money, their instinctive preference is to go to a moneylender and borrow at exorbitant rates.
This is unfortunate because gold loans have major plus points and are particularly well-suited for India. Here is a listing of some of those benefits:
i) Avoids debt trap: A gold loan is settled either by repayment or, in case of default, by sale of the pledged security. The cycle of non-payment and rollovers of the loan at escalating rates of interest does not happen. In the worst case the borrower may lose his gold but there is no debt trap.
ii) Simple procedures, fast disbursal: The formalities in availing gold loans are minimal and procedures are simple. In practice, the entire process should hardly take fifteen to twenty minutes. This makes gold loans ideal for the micro-finance segment where the loan amounts are small and where there is no point in testing the borrower’s patience with elaborate procedure.
iii) No depreciation of underlying asset: Unlike other secured loans, the underlying asset in a gold loan is not subject to depreciation. At the same time, unlike land, it is a liquid asset and the transaction costs involved when enforcing the security are minimal. Thanks to this, the lender always enjoys a degree of comfort not available in other loans, and he does not have to go chasing after the borrower for timely repayments of instalments or EMIs. As for a borrower facing temporary difficulties, the only compulsion is to keep on servicing the interest component, till his situation permits repayment.
iv) In practice, without recourse: Gold loans are effectively given out on a “without recourse” basis. Although the fine print of the loan agreement incorporates the right of recourse to the other assets of the borrower, in practice, this is almost never enforced. Defaults are settled by sale of the pledged gold and losses (if any) are written off. There are no recovery agents to go chasing after the borrower and his other properties with threats of legal action, court orders etc. In contrast, in a typical “secured” loan from a bank, in addition to the primary security, you need to put up collateral and bring along a Guarantor who also gets hauled into court in case of default.
v) No questions asked: People often borrow money on account of social compulsions which cannot be avoided in our cultural context; occasions like weddings, festivals, religious and social obligations etc. In this context, there is no denying that India’s banking sector continues to carry a hangover from the days of credit rationing that bank lending must always be for “productive” purposes. On the other hand, gold loans recognise that someone urgently in need of money cannot instead be made to settle for a lecture on wasteful consumption. Money is advanced solely on the criterion of the value of gold pledged and questions about the purpose of the loan would only be to confirm that anti-social or wildly speculative activities are not involved.
vi) Suited for the unorganised sector: Gold loans are ideal for those employed in the informal or unorganised sector and lacking documents to prove their incomes. This is a segment conventional banks generally avoid because their appraisal and credit scoring is based on formal documentation. Incidentally, more than 90 percent of India’s workforce is employed in the unorganised sector.
vii) Moral pressure against default: The recent success of the micro-finance sector has brought attention to the advantage of the group approach when lending to the poor. The loan is extended to individuals in a group and a default by any one member leads to the entire group being denied subsequent loans. Therefore, there is collective moral pressure on each member from the rest of the group to repay in time.
Something like this is at work in a gold loan too. There is no group approach but the market practice that gold loans are generally extended against household used jewellery has a similar impact. The fact is, borrowers and their families are emotionally attached to their family jewellery. Very often, it would have been acquired during important occasions like a marriage or the birth of a child etc. Occasions of wilful default, particularly with intention to capitalise on fluctuations in gold prices, are few and far between.
It therefore stands to reason that banks and financial institutions that choose to scale-up their gold loan portfolios would be able to do so with minimum risks. And, from a regulator’s perspective, gold loans can actually serve to minimise systemic risks.
viii) Gains for the wider economy: India has the world’s largest stock of privately held gold with informed estimates ranging from 15,000 to 20,000 tonnes of gold. When this gold is kept idle in our lockers and vaults, it is a drag on the Indian economy: it has the effect of keeping billions of dollars in savings (at a conservative price of $1,000 /oz., it amounts to about $480 to $ 650 billion) out of the financial system. This is a huge sum that otherwise could have been lent out to industries and for building infrastructure. When people borrow against gold (technically called “monetization”), the impact is to set in motion a whole new chain of economic activity boosting demand and consumption expenditure in the economy.
The road ahead
There is now increasing recognition that economic and social policies need to be rooted in reality, not in any visions of an ideal world. Today, the ground realities are that significant sections of the rural poor continue to lack access to banks, either to park their savings in, or as a fallback for loans in times of need. Also, given the country’s atypical cultural context, gold continues to play an important part in our lives, reflected in the fact that India is consistently the world’s largest consumer of gold. Under these circumstances, the organised gold loan segment is potentially a vehicle for social transformation. Considering that 65 percent of our massive private stock of gold is held by rural households, and that 75 percent of the gold loan market continues to be with the unorganised sector (local moneylenders and pawnbrokers), this is a market with tremendous potential for growth.
At the same time, there is an urgent need for the government and the regulators to recognise the professionalism and transparency that the organised sector brings to this field and encourage its growth. We need a radical shift in the regulatory approach, from one of tolerance with a multiplicity of hurdles, to that of facilitation and active promotion. A useful beginning can be made by not treating this sector on a par with local moneylenders and pawnbrokers. And, it will help if gold loans are not clubbed with other NBFC lending when prescribing regulatory capital.
The distress faced by India’s farmers in recent years highlights the need to move on multiple fronts in extending timely credit to the rural masses. Gold loans must be made a part of this process.
Note: An edited version of this article was published in the op-ed page of The Economic Times dated July 29, 2010 under the title “Gold Loans aid financial inclusion”.
Benefits of a Gold Loan:
If you are looking for the best deal which suits your requirements and can help you pay back money with comfort in time or before time, then Gold loans is the best Loan to apply. With the updated online information you will get enough knowledge about each step that you need to take. Everyone's family members, friends or relatives suggest enough plans and guidelines about gold loans, however, all one needs to do is compare the Gold Loan Interest Rateprovided by all the NBFCs and Banking institutions and all about their gold loan plan and then make your deal. The benefits of gold loan are many. People prefer gold loans over unsecured personal loans due to many reasons.
No income needed: All the banks and lenders before giving a loan to any person require that they have a strong repayment capacity. That is they have a good salary structure. So that it is easier for the individual to buy loans and repay it on time. But, in the case of a loan against gold, the scenario is completely changed. Here, the borrowers need to deposit gold to the companies providing loans on gold. These institutions will in return provide the approved amount of cash to the borrowers. As a result, there is no need for the income or salary proofs or structure of the individual, because all that creditors look out for is the original gold ornaments or coins as a security deposit. On the basis of the gold's quality the amount is granted to the borrowers. So, even an unemployed person can apply for gold loan without any obstacles.
Bad credit record: Even though one has a bad credit history or record in the books of accounts, the companies are not affected with the credit or bad debts. As far as one provides them with the gold, they are not concerned with anything related to your finance or credits. Therefore, any person with a poor credit score in need of urgent finance can avail a loan against their gold ornaments and jewellery.
Low interest rates: A good advantage about gold loans is the low interest rate offered by the banks, which is between 12-16% annually. When you compare this interest rate to any other interest rate say, home loans or personal loans, you will notice that gold loans interest rate is much better to go on with. This is very advantageous for people who need a loan at affordable interest rates.
Onetime payment: Borrowers are given a choice to make onetime payment. That is, a person can pay only the interest during the tenure of the loan and then pay the rest of the borrowed amount in a single payment at the end of the loan duration.
Comfortable loan: The most convenient and comfortable loan is gold loan, the reason behind this is that with your gold pledged to the financers or banks, you will get loan of about 80% market value price of gold. All you need to have here is the gold. A gold loan is the most easiest and quick loan to get as the processing time is lesser than 30 minutes. Most of the NBFCs can provide these loans less than 5 minutes.
Low risk: Gold jewellery and ornaments generally belong to the women of the family. Being emotionally attached to their ornaments the woman in the family may motivate the husband to release the gold jewellery as early as possible due to the insecurity of losing it. So here, there is low risk at the creditors end. Borrowers end up either pre paying the amount or clear all EMIs on time which is an added advantage.
Speedy sanction: Gold loans do not require days and months to get sanctioned. It’s only a few minutes job. No documentations or long legal procedures. It’s just a speedy sanctioning process, once gold is handed to the creditors, you will within minutes receive a cheque or cash deposit in your account. The complete process of approval and sanction of the loan depends on the quality of the gold provided and its verification.
Key benefits of gold loan
1. Avoids debt trap: A gold loan is settled either by repayment or, in case of default, by sale of the pledged
security. In the worst case, the borrower may lose his gold but there is no debt trap.
2. Simple procedures, fast disbursal: The formalities in availing gold loans are minimal and procedures are simple. In practice, the entire process should hardly take 15 to 20 minutes. This makes gold loans ideal for the micro-finance segment where the loan amounts are small and where there is no point in testing the borrower’s patience with an elaborate procedure.
3. No depreciation of underlying asset: Unlike other secured loans,the underlying asset in a gold loan is not subject to depreciation. At the same time, unlike land, it is a liquid asset and the transaction costs involved when enforcing the security are minimal.
4. In practice, without recourse: Gold loans are effectively given out on a ‘without recourse’ basis. Defaults are settled by sale of the pledged gold and losses (if any) are written off. There are no recovery agents to go chasing after the borrower and his other properties with threats of legal action and court orders.
5. No questions asked: People often borrow money on account of social compulsions which cannot be avoided in our cultural context; occasions such as weddings, festivals and religious and social obligations.
Risks to Borrowers and Lenders
Since lenders take possession of the gold assets in a loan transaction, in case of a theft they may not have sufficient funds to compensate all the borrowers for their loss in its entirety. This is more important for loans placed in the unorganized sector; banks/NBFCs usually have better security and insurance coverage. Furthermore, financial packages cannot compensate for the personal attachment a borrower has with the gold assets.
Moreover, a sharp decline in gold prices increases the original LTV. A lender may require an immediate recovery of any amount that exceeds the original LTV ratio, but the borrower may be unable to pay this amount. Restructuring of the loan may be required in these cases. Addition¬ally, if the value of the pledged asset declines, a borrower may be more willing to default on the loan. This poses a serious concentration risk to the lender, especially to the NBFCs that have a high exposure to gold loans and lend at high LTV ratios.
The increase in gold prices over the last few years, coupled with the surge in gold loan borrowings during this period, could create a gold bubble which could burst in the event of a significant correction in gold prices. Banks/NBFCs with significant exposure to gold loans could face widespread defaults, which could adversely impact the economy.
The organized sector today manages these risks through various methods such as enhanced security, insurance cover, buying gold futures, etc.
Objectives of the study
This study is descriptive in nature and aims to deepen the understanding of the Indian gold loan market. The study also tries to know the difference between the conventional personal loans and gold loans. Through this study, an attempt is made to know the various purposes for which clients acquire gold loans.
Specifically the study tries:
1. To gather knowledge about the Indian gold loan market
2. To find the reasons for choosing gold loans over conventional personal loans
3. To know the purposes for availing gold loans by the respondents
An overview of Indian gold loan market
India is known to possess large stocks of gold, estimated at about 11 percent of global gold stock. Over the past ten years, the value of gold in India has increased at a compounded average growth rate (CAGR) of 13 per cent, outpacing the country’s real gross domestic product (GDP), inflation and population growth by 6 per cent, 8 per cent and 12 per cent, respectively. India has one of the highest savings rates in the world (34 per cent of GDP in FY10), of which the one third is invested in gold. In India, gold prices increased by a staggering 180 per cent during FY06-FY11 and have outperformed practically all known asset classes in the last decade. It is estimated that 10 per cent of the country’s gold stock is pledged as collateral for loans. The gold loan market in India is broadly classified into two categories, namely, organised sector and unorganised sector. Organised sector primarily constitutes of formal institutions such as banks and NBFCs; unorganised sector includes informal institutions such as private money lenders and pawnbrokers. However, the market share between the unorganised and the organised sector is extremely skewed; approximately 75 per cent is in the unorganised market (money lenders and pawnbrokers), and the remaining 25 per cent in the organised market (specialised NBFCs and commercial/cooperative banks). The value of the organised gold loan market in India is stimated at ` 400-450 billion, with a CAGR of approximately 40 per cent during FY02-FY10.
Best Gold loan Companies in India
Gold loan is preferred to as debt financing whereby a gold businessman purchases gold from lending company and sell it in the open market and get it for mine creation and afterwards then he pay back the gold from mine production. Gold loan gives ready cash for those who are in want of money for fulfilling basic financial necessities. Certain benifits are associated with gold loans basically low interest rate, no sort of income certificate required, comfortable. Certain important Gold loans available in India are as follows:
1. Muthoot Finance Gold Loan
Muthoot is a Kerala originated association set up by MuthootNinanMathai in 1887 at Kozhencherry in Travancore district which was later being adopted by M George Muthoot. Loan is received within a time period of 5 min. It ranges from Rs 1500 to 1 crore. 0%processing fees.Interest rate of 1%per month.
2. Mannapuram Finance Gold Loan
Mannapuram Finance also facilitates gold loan within 5 minutes. It help to draw instant Cash by subscribing gold ornaments and Jewellery. It provides loan at higher points, based on purity, net weight of gold. The candidate must have one recent ID—Voter ID/ Ration Card/ Driving License/ Passport. No time-consuming formalities involved.
3. Indian Overseas Bank
Indian Overseas Bank provides credit facility to needy farmers. The lending rate is Rs 1800 per gram gold ornaments. Based priority sector like agricultural purposes. Under non priority sector for basic necessities for unforseen expenses. Loan amount consumption purposes is upto Rs.2000/-. The Non-Priority Sector loan amount is max.Rs.5 lacs.
4. HDFC Gold loan
HDFC gold loan term loan provides instant loans . Regular interest on loan is being granted. Identity Proof like Passport Copy/ Voters ID card/ Driving License along with proof like Ration card/ Telephone Bill/ Electricity Bill/ Rental Agreement/ Passport copy/Trade license /Shop &Est License / Sales Tax certificate, 2 pass port size photographs.
5. Federal Bank
Federal Bank is loan which satisfies as a biggest advantage to overcome crisis and is a personal loan phenomena. It has low interest rate. The loan amount of Rs 10 lakh is attained by the customer. It also provides gold loan for farmers for agricultural necessities. The main documents required for applying gold loans are
Letter of witness in case of illiterate borrowers.
Two passport size photographs of the borrower.
DP Note delivery.
All the gold ornaments that are to be kept as mortgage for the loan.
Gold Loan application.
NBSF gold loanprovidinginstitutions
1. Muthoot Finance Gold Loan
2. Mannapuram Finance Gold Loan
3. HDFC BANK
Public gold loan providing institutions
1. Indian Bank
2. Indian Overseas Bank
3. Federal Bank
4. South Indian Bank
PRIVATE GOLD LOAN PROVIDING INSTITUTIONS
1. Muthoot Finance Gold Loan
Introduction
It is an Indian financial corporation. It is known as the largest gold financing company in the world. In addition to financing gold transactions, the company offers foreign exchange services, money transfers, wealth management services, travel and tourism services, and sells gold coins at Muthoot Finance Branches. The company's headquarters are located in Kerala, India, and it operates over 4,400 branches throughout the country. Outside India, Muthoot Finance is established in the UK, the US, and the United Arab Emirates. While the company falls under the brand umbrella of the Muthoot Group, its stocks are listed on the Bombay Stock Exchange (BSE) andNSE. As of March 2012, revenue (after expenditure) stood at more than Rs. 23,000 crore ($4.2 billion). The target market of Muthoot Finance includes small businesses, vendors, farmers, traders, SME business owners, and salaried individuals.
Vision
Touching the lives of millions with customer-centric approach nourished in a milieu that enables creation and innovation.
Corporate background
Muthoot Finance was founded by M George Muthoot in 1939. Muthoot Finance to enter capital market through IPO route - Economic Times. The company has been licensed by Reserve Bank of India under Section 45 I(a) of the RBI Act, 1934 to function as a Non-banking financial company(NBFC) without accepting public deposits and is specifically exempted from the provisions of the Money Lenders Act in Karnataka and other states. The company's gold loan business constitutes more than 99 percent of its total income. its retail loan assets stand at Rs. 23,763 Crs. the total number of shares of Muthoot Finance held by Individuals/Hindu Undivided Family stood at 80.12 percent and the public shareholdings from Mutual Funds/UTI totaled 3.52 percent.
Awards and recognition
• Muthoot Finance won the Skoch Financial Inclusion Award 2013 in recognition of its major initiative in the area of 'Access to Banking and Financial Services' to the aamaadmi who had been excluded from the country's banking network for decades.
• In 2012, Muthoot Finance was voted the most trusted finance brand in India according to the Brand Trust Report 2012, a study conducted by Trust Research Advisory. In the Brand Trust Report 2013 however, Muthoot Finance was voted second-most trusted finance brand in India, but it regained its place as India's most trusted finance brand in the Brand Trust Report 2014.
• In 2012, the company won the Asian Sustainability Leadership Award for “Best Rural Outreach.
• BFSI Award for the "Most Admired Loyalty Program" in 2012 at The Asian Leadership Awards heald at Dubai.
• Golden Peacock Award for CSR being conferred upon Muthoot Finance Ltd. in the financial services sector at the 7th International Conference on Social RESPONSIBILITY at the Dubai Global Convention 2012
• In 2013 company won the Golden Peacock Award "HR Excellence for 2013", which recognizes the continuing commitment by business to conduct itself ethically and contribute to economic development, while improving the quality of life of the workforce.
Special offers running on Muthoot Finance Gold Loan for the Month
✓ Double Dhamaka Scheme – 8% discount in interest rate on payment of monthly interest
✓ USHA IRON box worth ₹ 845/ – for availing loan above ₹ 3 lakh*
✓ USHA Mixie worth ₹ 3795/ for availing loan above ₹ 10 Lakh*
Mannapuram Finance Gold Loan
ShriNandakumar took over the reins of this one Branch business in the year 1986 when his father expired. Since then, it has been a story of unparalleled growth, with new milestones being crossed every year. Manappuram Finance Ltd. was incorporated in 1992 (the original name was Manappuram General Finance and Leasing Limited) with its registered office at Valapad, in the Thrissur District of Kerala. It is India's first listed and highest credit rated gold loan company and widely recognised as a leading wealth creator in the Indian stock market. Since inception, the Company has maintained a consistently rapid pace of growth. Today, it has around 3,300 branches across 26 states and UTs with Assets under Management
(AUM) of about Rs.10,000crores, a workforce of about 18,000 and a live customer base of 15 lakhs (Data as of 31 March, 2013).
The vision:
Within the next decade, Manappuram Finance Limited hopes to emerge as the largest player in the gold loan sector in India and also to expand its footprint beyond national borders. The long term vision of the company is to unlock the value of India's large stock of privately held gold (estimated at about 18,000 tonnes) to the benefit of the common people of India, most of who possess savings in the form of gold jewellery. This is neatly summed up in the Company's corporate tagline, "Energising gold, empowering people".
achievements:
Soon after it commenced its operations, Manappuram Finance Limited gathered several "firsts" to its credit. The company was the First NBFC in Kerala to receive a Certificate of Registration issued by the RBI. It was the first Kerala based NBFC to get a Credit Rating in 1995 of "MA" (current rating MA+) from ICRA, recognising the company's ability to make timely repayments of the principal and interest under its then existing public deposits programme. Manappuram Finance was one of the very first NBFCs from Kerala to go for a Public Issue of its shares in 1995. In fact, the company has been consistently making profits and consistently paying dividends from the very first full year of operations.
The company was also the first NBFC from Kerala to issue bonus shares in the ratio of 1:1 in 2007 and then, repeat the feat twice, in 2010 and in 2011 (making it three such instances in five years). Moreover, in 2007, Manappuram Finance Ltd became the first Kerala based NBFC to receive foreign Investment from FIIs, and also get the highest short term credit rating of A1+ from ICRA. In 2010, it became the very first Kerala-based company to offer ESOPs (Employee Stock Option Plan) to its middle and senior management functionaries. In April 2011, it became only the second listed company from Kerala to have its shares traded in the "A-Group" at the Bombay stock exchange.
Other activities:
As part of its diversification, Manappuram Finance Limited has also ventured into the Foreign Exchange business with the Reserve Bank of India having granted an Authorised Dealer - II licence to the Company which permits it to effect outward remittances for a variety of purposes such as overseas medical treatment, higher education abroad, business travel, conferences etc. The Company has also commenced Instant Money Transfer in collaboration with UAE Xchange, Wallstreet and MoneyGram.
Manappuram Gold Loan Interest Rates, Schemes, Best Offers
Key Features of Manappuram Gold Loan Schemes
. HDFC Gold loan
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of RBI's liberalisation of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.
Vision Statement
"Become the undisputed market leader in providing housing related finances, to realize the dream of shelter for all in Sri Lanka"
Mission Statement
To our shareholders, our mission is to optimize returns.
To our customers, our mission is to provide a caring service by anticipating their requirements and innovatively satisfying them beyond their expectations.
To our staff, our mission is to identify their multi-faceted talents, develop, motivate, recognize and reward them towards fulfillment of the institutional and national housing vision.
To the national economy and the industry regulator, we are the key driver and thought leader, shaping and financing the national housing policy.
To our natural environment, we enforce sustainable practices across all our activities.
Corporate Governance Rating
The bank was among the first four companies, which subjected itself to a Corporate Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating Information Services of India Limited (CRISIL).
The rating provides an independent assessment of an entity's current performance and an expectation on its "balanced value creation and corporate governance practices" in future. The bank has been assigned a 'CRISIL GVC Level 1' rating, which indicates that the bank's capability with respect to wealth creation for all its stakeholders while adopting sound corporate governance practices is the highest.
We are aware that all these awards are mere milestones in the continuing, never-ending journey of providing excellent service to our customers. We are confident, however, that with your feedback and support, we will be able to maintain and improve our services.
Features & Benefits
Quick
Over the Counter Loan DisbursementEasy
No documentation
Safe
Unique 3 way sealing to ensure
your gold is secure in our safety vault.
Smart
Flexible Pricing and tenor for making a smart choice.
Why take a Gold Loan from HDFC Bank?
Whatever be your need we have a loan for you. Over the years we have won the trust of our customers and have become market leader in loan products.
Enjoy triple benefits when you take a loan against gold from HDFC Bank:
Faster loan - Our gold loan sanction and disbursal is one of the quickest with easy documentation.
Competitive pricing – Our rates and charges for loan against gold are very attractive.
Transparency – All charges are communicated up front in writing along with the gold loan quotation
4.Indian Bank
Life is full of opportunities. Take advantage of them at the right time to get ahead. Sometimes finances are a constraint and due to other commitments we let the opportunities pass by.
But not anymore!
Now make use of the assets you have – use your gold to help you get an Indian Bank Gold Loan. Your gold stays safe while you can go ahead and take advantage of every opportunity.
Instant Gold Loan
You can now walk-into any of our Indian Bank branch offering Gold loans with your jewellery and you can avail gold loan for any value from Rs. 10,000 to Rs. 15 Lakhs instantly. With our simple and easy documentation process, the loan can be availed across the counter instantly. Coupled with the most competitive rate per gram and an attractive interest rate, you have a sure winner on hand.
Safety
Most important is that your gold is absolutely safe with us. Our expert valuer appraises your gold jewellery in your presence, seals them in a tamper proof pouch and places them in our strong vault. Giving you the guaranteed assurance of complete transparency and peace of mind.
Documentation
1. Two passport size photograph
2. ID Proof such as Driving License / PAN Card / Form 60/61 / Passport Copy / Voter ID Card / Aadhaar Card / Ration Card. Any one document needs to be submitted
3. Address Proof such as Driving License / Voter ID Card / Ration Card / Aadhaar Card / Passport Copy / registered lease agreement with not older than 3 months utility bills in the name of landlord (any one)
4. Proof of land holding in case of agriculture loan of more than Rs. 1 lakh
PUBLIC GOLD LOAN PROVIDING INSTITUTIONS
1.Indian Overseas Bank
Indian Overseas Bank provides alternate source of credit to needy farmers as well as individuals.
Eligibility:-
All individuals are eligible to avail loan under this scheme.
Quantum of loan:-
Priority sector -- Need based /Project based.
Consumption loan -- Up to Rs.2, 000/-.
Non-priority sector -Up to Rs.4.00 lakh. Sanctioned by Branch Head as per their delegated power and maximum up to Rs.10.00 lakh sanctioned by RLCC
LENDING RATE:-
The lending rate of the Union Gold scheme is Rs.1800 per gram of gold ornaments of 22 carats or 80% of appraised value of gold, whichever is less, subject to periodical revision by the Bank on the basis of gold price.
2.Federal Bank
Bank's existing customers can avail the loan upto Rs.20 lacs by pledge of gold ornaments including gold coins sold by Banks. It requires minimum paper work and has low interest rate
FEDERAL is India’s largest lender and ranked among the leading banks in the country. It offers various loans to it’s customers for meeting their different financial needs. FEDERAL’s Gold Loan is flexible loan scheme of Gold Loan/Loan against Ornaments. The loan amount range between Rs. 10,000 to Rs. 20 Lakh. It charges interest rate of 12.50%. Bank’s existing customers can avail a loan uptoRs. 20 Lakhs by pledge of gold ornaments including gold coins sold by Banks. To avail a gold loan you are required to complete minimal paper work.
Special features
• Extremely low interest rates with no hidden charges
• Offers long tenure loans of up to 30 months
• Pan India branch network
3.South Indian Bank
South Indian Bank offers Gold Loan to its customers under two different schemes. While one scheme is a term loan the other is granted as an overdraft facility. Both the loans have different features which should be studied in detail. Let us take a look at the different types of Gold Loans available with the bank.
Thefeatures of the loan are as follows:
o The loan is available at the Metro or urban centers of the bank only
o The loan is offered as an overdraft facility or as a loan
o The loan is issued to traders for their working capital requirement or for purchasing equipment for the purpose of development of the shop
o The minimum amount of loan available is Rs.50, 000 and the maximum amount of loan is Rs.2 lakhs. So, traders can avail any amount from Rs.50, 000 – Rs.2 lakhs to ensure a smooth running of their business
o The bank keeps a margin of 25% as a margin and advances the rest 75% of the value of the gold coins, jewelry or ornaments up to a maximum amount of Rs.2 lakhs
o In case of a loan the maximum repayment period is 60 months or 5 years. In case the loan is availed as an overdraft facility, the maximum period of repayment is only 12 months or 1 year.
o The processing charges on the loan is 0.50% of the loan amount sanctioned subject to a minimum of Rs.250 plus service tax as applicable
Bank of Travancore
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Bank of Travancore is one of the oldest and major commercial banks of India. At the time of its establishment, the bank was known as Canara Industrial and Banking Travancore Limited. The bank, along with 13 major commercial banks of India, was nationalized on 19 July 1969, by the Government of India. The Bank is well equipped to meet the challenges of the 21st century in the areas of information technology, knowledge and competition. Bank of Travancore provides personal loan to both salaried and non salaries class individuals. Read on to learn about the eligibility and documentation requirements for the loan you avail.
4.Canara Bank
There are many people who buy gold ornaments, jewellery or invest in gold coins. This is because, over the recent years the value of gold has risen and so has its importance. When a person buys gold, it gives a sense of security to the people that they have made a safe investment. Unlike other investments gold as an investment is considered safe. Not only this, it is loved by women. However, most people do not realize that the gold bought for securing their future can be used to safeguard their present as well. A person who is in need of some kind of instant finance can apply for a loan on the gold that they have in their house or lockers.
Following are the Features of Gold Loan:
• You can avail Loan up to Rs.1 Crore or more & up to 70% of value for any purpose
• You get 100% Safety & Security of your Gold Jewellery
• Get your Loan processed in less than 30 minutes
• Enjoy Anytime Liquidity.
• No EMI, Service only Interest and enjoy the Loan facility
• Lower Interest Rates
• Simple documentation and fast processing.
• Overdraft limit varies depending on the market rate of gold.
• Interest rate is payable only amount of the overdraft that you use.