Bullet repayment in Gold Loans


Repay your gold loan in one shot The Indian gold loan market is expanding at a CAGR of 12.75% and is expected to reach Rs.6275.40 Bn by 2025. Sometimes, we need to raise a loan to meet some medical emergency or educational purpose. If you are a small and medium enterprise owner, you may need some quick cash for business purposes. The gold loans extended by banks and NBFCs are beneficial in such situations.

Let’s go through some of the different gold loan repayment options MuthootFincorp ONE offers to its customers.

1. Repayment of the gold loan as EMI The EMI consists of the interest and components of the principal. This scheme is ideal if you are a salaried employee with a regular monthly cash flow in your account. This mode of payment will reduce your interest cost and the pressure of repaying the total loan amount at the end of the term.

2. Partial payments Partial payment is a customer-centric approach. You can make payments of interest and principal components as and when you choose without the restriction of EMI. Interest is calculated daily on the outstanding loan amount. The sooner you pay the principal amount, the less interest you pay. You will be more comfortable as you can repay according to your financial situation. With MuthootFincorp ONE, one of India's most trusted financial institutions, you can pay back your gold loan earlier and ensure complete transparency and safety throughout your relationship.

3. Interest in EMI & Principal at closure In this option, you can pay interest monthly, like EMI, and the principal at maturity. You will be relaxed to settle the principal at the end of the tenure by just servicing the monthly interest.

4. Pay interest first With this option you can pay the interest upfront and settle the principal at the end of the term. You need not worry about any monthly payments till the end of your tenure.

5. Gold loan Bullet repayment Bullet repayment is an option to pay the principal with the interest of the entire tenure as a single shot. You need not make any payments till the end of the term. The total interest and principal are paid as one shot hence the term bullet payment.

The interest is calculated monthly but payable at the end of the term. This scheme is suitable if you can repay within 6 to 12 months, and lenders may limit the loan amount to Rs.2 lakhs, subject to conditions. Bullet repayment is not on reducing balance terms, so you may pay higher interest than other repayment modes.

It is equally important for you to choose a suitable repayment plan as you apply for a gold loan.

Our support team would be happy to help you choose the right option based on your financial planning. We are one of the most trusted financial institutions in the country, with a legacy of 135 years. Our flexible gold loan repayment options will help you to manage your finances well. Head to our EPay website to repay gold loans faster.

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