Podcast
Questions and Answers
Who may be assigned the job of Gold Loan processing by the Branch Head?
Who may be assigned the job of Gold Loan processing by the Branch Head?
What is the maximum loan limit for tenant farmers, oral lessees, and sharecroppers without evidence of land record?
What is the maximum loan limit for tenant farmers, oral lessees, and sharecroppers without evidence of land record?
What is the primary purpose of the MC-KCC-GOLD LOAN FOR AGRI PRODUCT?
What is the primary purpose of the MC-KCC-GOLD LOAN FOR AGRI PRODUCT?
Which of the following is NOT considered eligible for the MC-KCC-GOLD LOAN?
Which of the following is NOT considered eligible for the MC-KCC-GOLD LOAN?
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What must the branch mandatorily obtain from all borrowers regarding their land when processing a gold loan?
What must the branch mandatorily obtain from all borrowers regarding their land when processing a gold loan?
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What is the upper limit of gold loans to a single borrower or CIF?
What is the upper limit of gold loans to a single borrower or CIF?
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What is the penalty rate for the defaulted portion of a gold loan?
What is the penalty rate for the defaulted portion of a gold loan?
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What is the minimum charge for a gold appraisal at URMET branches?
What is the minimum charge for a gold appraisal at URMET branches?
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If a borrower has more than five existing Agri gold loans, what should be done?
If a borrower has more than five existing Agri gold loans, what should be done?
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What is the maximum gold appraiser charge at RUSU branches?
What is the maximum gold appraiser charge at RUSU branches?
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What is the minimum loan amount for the SME Gold Loan Scheme?
What is the minimum loan amount for the SME Gold Loan Scheme?
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For how long can the Bullet Repayment Gold Loan be taken?
For how long can the Bullet Repayment Gold Loan be taken?
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What is the maximum loan amount that can be sanctioned per customer?
What is the maximum loan amount that can be sanctioned per customer?
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What is the maximum weight of specially minted gold coins sold by the bank to an individual customer?
What is the maximum weight of specially minted gold coins sold by the bank to an individual customer?
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Which repayment option has a minimum margin requirement of 50%?
Which repayment option has a minimum margin requirement of 50%?
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What is the maximum loan amount available under the gold loan for agricultural purposes?
What is the maximum loan amount available under the gold loan for agricultural purposes?
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Which categories of borrowers are eligible to avail a gold loan under the Agriculture segment?
Which categories of borrowers are eligible to avail a gold loan under the Agriculture segment?
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What margin is required for a 12-month Bullet Repayment Gold Loan?
What margin is required for a 12-month Bullet Repayment Gold Loan?
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What is the current interest rate for raising a short-term crop loan up to Rs. 3.00 lakh?
What is the current interest rate for raising a short-term crop loan up to Rs. 3.00 lakh?
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How often are the Market Value and Advance Value for gold updated?
How often are the Market Value and Advance Value for gold updated?
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What is the required margin for crop loans under the gold loan scheme?
What is the required margin for crop loans under the gold loan scheme?
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What is the maximum loan amount for the Agri Gold Loan segment?
What is the maximum loan amount for the Agri Gold Loan segment?
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How is the effective interest rate for short-term crop loans above Rs. 3.00 lakh calculated?
How is the effective interest rate for short-term crop loans above Rs. 3.00 lakh calculated?
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What determines the eligible loan amount when availing a gold loan for farm activity?
What determines the eligible loan amount when availing a gold loan for farm activity?
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Which of the following is NOT considered an allied activity for the purpose of this gold loan?
Which of the following is NOT considered an allied activity for the purpose of this gold loan?
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What is a factor that will NOT influence the total loan amount required for allied activity?
What is a factor that will NOT influence the total loan amount required for allied activity?
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What does the presence of fumes followed by foam indicate about a metal?
What does the presence of fumes followed by foam indicate about a metal?
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What color does nitric acid turn inferior gold?
What color does nitric acid turn inferior gold?
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In the specific gravity test, what is the specific gravity of 24 carat gold?
In the specific gravity test, what is the specific gravity of 24 carat gold?
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What should be obtained if a local goldsmith is employed for testing?
What should be obtained if a local goldsmith is employed for testing?
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How should branches exercise caution regarding Bangles/Kadas?
How should branches exercise caution regarding Bangles/Kadas?
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What is the purpose of using gold assaying machines?
What is the purpose of using gold assaying machines?
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What will help staff become more efficient in using testing machines?
What will help staff become more efficient in using testing machines?
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What happens if the weight in water (Y) is less than the expected result?
What happens if the weight in water (Y) is less than the expected result?
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What happens once the Loan-to-Value (LTV) ratio exceeds 90%?
What happens once the Loan-to-Value (LTV) ratio exceeds 90%?
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How long does a borrower have to regularize their loan account after the first notice is sent?
How long does a borrower have to regularize their loan account after the first notice is sent?
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What must happen if the loan account is not regularized within 15 days?
What must happen if the loan account is not regularized within 15 days?
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What is the time frame to complete the auction process after the final notice is sent?
What is the time frame to complete the auction process after the final notice is sent?
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Who has the final responsibility for the quality and purity of gold ornaments?
Who has the final responsibility for the quality and purity of gold ornaments?
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How many gold appraisers should be linked to each branch handling gold loans?
How many gold appraisers should be linked to each branch handling gold loans?
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What process must branches ensure does not breach the LTV ratio for Agri Gold Loans?
What process must branches ensure does not breach the LTV ratio for Agri Gold Loans?
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What is the responsibility of the Joint custodian regarding gold ornaments?
What is the responsibility of the Joint custodian regarding gold ornaments?
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Study Notes
Asset Product - Gold Loan
- Purpose: A general-purpose loan for individuals secured by gold ornaments or specially-minted gold coins. This is not a speculative loan.
- SBI Realty Gold Loan: Offered for specified requirements within a housing loan, such as margin money, registration charges, and project escalation. Gold ornaments and coins sold by banks can be pledged.
- Important Note: 24-carat gold bars and biscuits are not eligible for loan security. The total weight of gold coins pledged cannot exceed 50 grams per customer.
- Eligibility Criteria (General): Individuals aged 18 or above, with a steady income source (including bank employees and pensioners). Proof of income is mandatory. KYC compliance is required. The borrower must demonstrate the ability to repay the loan (EMI service capability). The borrower must achieve a score of 40 or above in a risk-scoring model (RSM). Declaration from the borrower about ownership of the offered ornaments.
- Eligibility Criteria (Realty Gold Loan): Meets the general criteria above and also needs a housing loan with SBI (both new and existing loans), and the capacity to service the EMI
Income Tax Benefit (SBI Realty Gold Loan Variants)
- Section 24(b): Interest benefits are available. Details of the benefits are provided in the document under the "Income Tax Benefit" section.
Product Variants
- SBI Personal Gold Loan: Varies by repayment structure (3, 6, 12 months) or based on EMI. The option of bullet repayment is also available. Realty loans also have the option of bullet repayment (3, 6, or 12 months), or EMI based. Top up Gold Loan also is available.
- Agri Gold Loan: Options include MC-KCC-Gold Loan for Agri Product, and a Multi-Purpose Agri Gold Loan Scheme with specific codes.
- SME Gold Loan: Minimum loan amount exceeding Rs 1 lakh, maximum loan of Rs 20 lakhs
Loan Amount
- Minimum: Rs 20,000 (or Rs 10,000 for top-up, and Rs 50,000 for realty loans)
- Maximum: Rs 50,00,000 per customer (total across multiple loan accounts)
Market Value and Advance Value of Gold
- The Market and Advance Value of different karat purities of gold are updated monthly.
Quantum of Advance
- Advance amounts are based on monthly gold price listings for 18/22/24-carat gold. Assessment of the gold's purity is assessed at the time of loan sanction.
Margin
- Different margin rates are available based on the loan type and duration. Minimum margin rate is 25%, however, various loan variants have slightly different rates
Repayment Period
- Repayment periods are dependent on the type of Gold Loan (3 months, 6 months, 12 months or EMI-based, Top-Up etc.)
Advances to Staff (Demand Loan)
- Loans for medical/educational expenses/marriage of dependents or for housing purposes are repaid through 60 or 100 monthly installments, respectively (inclusive of interest).
Photographs of Ornaments
- A photograph of all gold ornaments offered as security is taken during processing and signed by the borrower and custodians. A printed copy is kept with the documents; the photograph should be large enough for clarity.
Valuation of Gold Ornaments
- The valuation depends on the type of loan and the exposure amount; however, different criteria are applied based on the amount, and branches will choose different appraisers for specified amounts (Rs 50,000 and above).
Custody of Gold Ornaments
- Gold ornaments are kept in the strong room under the joint custody of the branch manager, accountant, and branch cash officer.
Delivery of Ornaments
- Ornaments are returned to the borrower upon loan repayment, with proper acknowledgement. Exceptions are made for loan accounts that are closed if the ornaments are kept in the safe deposit under officer in-charge and custodians.
Calling Up of Advance
- Rules are outlined (in the event of increase / decrease in gold market rates) for revising advance value accordingly.
Product Variants Under Personal Gold Loan Scheme
- Short-term loans (3 months, 6 months, 12 months) with interest and principal repaid at the end of the term.
Custody of Gold Ornaments Pledged
- Gold ornaments should be stored in a strong room, with joint custody.
Surprise Verification
- Branches conduct surprise inspections of gold ornaments to maintain security.
Various Gold Testing Methods
- Different methods such as touchstone, nitric acid, specific gravity test, or using gold assaying machines (Karatometers) are used to assess the gold's purity.
Gold Loan Documentation
- Required documents include applications, appraisals, acknowledgments, and witness letters (for illiterate borrowers).
Disbursement
- Loan amounts are disbursed into the borrower's bank accounts, not in cash, and KCC accounts are excluded.
Service Area
- Borrowers are required to reside within 25-30 km of the branch.
Surprise Verification
- For fraud prevention, branches do surprise checks of gold holdings.
Spurt in Agri Gold Loan Portfolio
- Checks/verification are carried out to maintain quality and value of pledged gold ornaments.
Gold Loan Release Letter Acknowledgment
- Generated at the opening of the gold loan and stored with documents, including borrower's or client's acknowledgment.
Loan to Value
- LTV ratio of 75% must be maintained (as long as the loan tenure lasts) and interest is charged monthly but due at EOT.
Assessment and Security Valuation
- Gold appraisers are part of verification for loans above Rs 50,000.
Purity Testing
- Procedures exist to test the purity of gold (touchstone, nitric acid, and specific gravity).
Documentation
- Procedures specify documentation requirements (applications, appraisals, acknowledgments, etc.).
Penal Charges
- Rules for penal charges and pre-payment penalties are outlined, as is the process for handling overdue accounts.
Gold Appraiser Charges
- An outlined range of fees for pre-payment penalties exists.
Other Conditions
- Terms on post-sanction visits are outlined and interest subvention procedures are described.
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Description
Test your knowledge on the regulations and guidelines associated with gold loan processing, including eligibility, loan limits, and appraisal charges. This quiz covers various aspects of gold loans tailored for agricultural purposes and other borrowers. Are you familiar with the MC-KCC-GOLD LOAN and its requirements?
