Loan On Silver, RBI’s New Rule
Loan on Silver: The Reserve Bank of India (RBI) has now allowed loans on silver. This means that if you have silver jewellery or coins, you can also take a loan from banks or finance companies. The RBI has issued new guidelines for this purpose. Under the Reserve Bank of India Directions 2025, which outline all the rules related to pledging gold and silver. These rules will come into effect on April 1, 2026.
Who can provide loans against gold and silver?
- Commercial banks (including small finance and regional rural banks)
- Urban and rural cooperative banks
- NBFCs and Housing Finance Companies
To determine the value of gold or silver, the bank or NBFC will use the average closing price of the last 30 days or the previous day’s closing price, whichever is lower. This price will be based on the rates issued by the IBJA (India Bullion and Jewellers Association Ltd) or a recognised commodity exchange. The value of stones or other metals embedded in the jewellery will not be included.
The jewellery or silver will be evaluated in the presence of the borrower. The bank will provide a certified valuation report. All fees, auction procedures, and refund deadlines will be clearly stated in the loan agreement. All documents and information will be provided in the local language or the customer’s preferred language. The pledged silver or gold will be stored in a secure bank vault, accessible only to authorized personnel. Periodic audits and inspections will also be conducted.
