Gold Loan: Top 10 Banks Offering the Lowest Interest Rates – Check EMI on ₹1 Lakh Loan

Gold loans have become one of the most trusted and convenient borrowing options for millions of Indians, especially at a time when gold prices are hitting record highs. These loans allow borrowers to unlock the value of their jewelry without selling it, providing quick liquidity for urgent financial needs. Both banks and NBFCs are offering gold loans at competitive interest rates, making them a preferred choice for many.

If you are planning to avail a gold loan, knowing which bank offers the lowest interest rate is crucial. Here’s a list of the top 10 banks providing the cheapest gold loans in September 2025, along with the approximate monthly EMI for a ₹1 lakh loan over one year.

1. Indian Bank – Starting Interest Rate: 8%

Indian Bank offers one of the lowest gold loan rates in the market at just 8% per annum. For a ₹1 lakh loan, the monthly EMI works out to around ₹8,699 for 12 months. This makes it one of the most cost-effective choices.

2. Punjab National Bank (PNB) – 8.35%

PNB gold loans start at 8.35% annual interest. The EMI on a ₹1 lakh loan comes to about ₹8,715. With its wide network and trusted services, PNB is a popular option among borrowers.

3. Bank of India (BOI) – 8.60%

At 8.60% interest, Bank of India gold loans are ideal for customers who prefer a public sector bank. The EMI for a ₹1 lakh loan is approximately ₹8,727.

4. Canara Bank – 8.90%

Canara Bank provides gold loans starting from 8.90%. Borrowers pay around ₹8,741 EMI on ₹1 lakh. Customers also benefit from a hassle-free loan process.

5. Kotak Mahindra Bank – 9%

Kotak Mahindra Bank offers gold loans from 9% per annum. The EMI on ₹1 lakh for a year stands at about ₹8,745. Kotak is known for fast service and flexible repayment options.

6. ICICI Bank – 9.15%

ICICI Bank’s gold loan rates start at 9.15%. The EMI for ₹1 lakh is ₹8,752. With strong digital banking services, ICICI appeals to younger customers who prefer online applications.

7. HDFC Bank – 9.30%

HDFC Bank charges 9.30% interest on gold loans. For a ₹1 lakh loan, the EMI works out to ₹8,759. The bank is known for quick approvals and seamless online processes.

8. Bank of Baroda (BoB) – 9.40%

Bank of Baroda gold loans start at 9.40% interest. EMI on a ₹1 lakh loan is approximately ₹8,764. The bank’s strong presence in both urban and rural areas makes it accessible to a wide customer base.

9. Union Bank of India – 9.65%

Union Bank offers gold loans at 9.65% per annum. The EMI for ₹1 lakh over 12 months comes to ₹8,775. Its extensive branch network makes it a convenient option.

10. State Bank of India (SBI) – 10%

India’s largest bank, SBI, offers gold loans at 10% interest. The EMI for a ₹1 lakh loan is about ₹8,792. While not the cheapest, SBI remains the most trusted option for many customers due to its size and reliability.

Why Gold Loans Are Popular

Instant liquidity – Quick access to funds against pledged gold.

Lower interest rates – Much cheaper than personal loans or credit card borrowing.

No credit history required – Approval depends mainly on the value of gold pledged.

Flexible repayment – Options include EMIs, bullet payments, and overdraft facilities.

Retain ownership of jewelry – Customers don’t have to sell their ornaments to raise cash.

Key Takeaway

If you are looking for an affordable and reliable financing option, gold loans can be an excellent choice. Indian Bank, PNB, and BOI currently lead the list with the lowest interest rates, while private banks like ICICI, HDFC, and Kotak offer faster digital services. SBI, despite its slightly higher rates, remains a preferred option due to trust and nationwide accessibility.

Before availing a loan, customers should compare interest rates, processing fees, and repayment options to find the best deal.