Loan against Sovereign Gold Bond
Federal Bank offers ‘Loan against Sovereign Gold Bond’ which can be used to meet your personal needs or any other lawful needs. Pledge of Sovereign Gold Bond in both demat and physical form are accepted as security. This facility is available at all our branches.
Key Features & Benefits
|
Eligible customers |
Resident Individuals, Trusts, HUFs, Charitable Institutions and Universities. |
|
Type of facility |
Overdraft and Term Loan |
|
Rate of Interest |
12.50% |
|
Minimum Loan Amount |
Rs. 20,000 |
|
Maximum Loan Amount |
Rs. 25 Lakhs |
|
Loan Tenure |
Overdraft – 24 Months |
|
Term Loan – 60 Months |
|
|
Margin |
35% - For loans up to and including Rs. 20 Lakh |
|
50% - For loans above Rs. 20 Lakh and up to Rs. 25 Lakh |
|
|
Security |
Pledge of Sovereign Gold Bonds in both Demat and BLA/Physical Certificate form |
Fees & Charges
Processing Fee: 0.50% + Taxes of the limit subject to a minimum of Rs 1000 + Taxes
Interest Rates
12.50% Fixed
Frequently Asked Questions- Loan Against SGB
What is a Loan Against Sovereign Gold Bonds (SGB)?
A Loan Against Sovereign Gold Bonds (SGB) is a loan facility provided by Federal Bank where customers can avail a loan by pledging their Sovereign Gold Bonds issued by the Government of India.
Who is eligible to apply for a Loan Against SGB?
Individuals, Trusts, HUFs, Charitable Institutions and Universities who hold Sovereign Gold Bonds issued by the Government of India in their demat account are eligible to apply for a Loan Against SGB with Federal Bank.
What is the repayment tenure for a Loan Against SGB?
The repayment tenure for a Loan Against SGB provided by Federal Bank is up to 24 months (Overdraft) and 60 months (Term Loan). However, you can choose a shorter tenure if you prefer.
What are the interest rates for a Loan Against SGB?
The interest rates for a Loan Against SGB are subject to change and are usually competitive. Present interest rate is 12.50% (Fixed).
Can I prepay my Loan Against SGB before the completion of the tenure?
Yes, you can prepay your Loan Against SGB before the completion of the tenure.
What happens if I default on my Loan Against SGB?
If you default on your Loan Against SGB, Bank has the right to sell the pledged SGB to recover the outstanding loan amount. It is important to ensure timely repayments to avoid any negative consequences.
How can I apply for a Loan Against SGB with Federal Bank?
To apply for a Loan Against SGB, you may please visit your nearest Federal Bank branch.
Can I get a Loan Against SGB for any purpose?
Yes, you can use the funds obtained from a Loan Against SGB for any legitimate purpose, such as personal expenses, business needs, education, medical emergencies, etc.
Will my SGB be physically held by the bank during the loan tenure?
No, your SGB will not be physically held by the bank during the loan tenure. Instead, the bonds will remain in your demat account, and they will be marked as pledged to Federal Bank until the loan is repaid in full.