Merakyat.org – The need for emergency cash is a common occurrence, and many people turn to loans as a solution. While personal loans are often a quick option for funding, the rising interest rates can make the monthly installments, or EMIs, costlier.
One alternative option is a gold loan, which is a secured loan that is obtained by pledging gold as collateral. Gold loans can be obtained from banks or financial service providers and are a popular choice for funding urgent expenses, such as paying for education, medical treatment, travel, or starting a new business.
Rajesh Shet, Founder and CEO of SahiBandhu, has outlined five reasons why gold loans are a good option for funding during a cash emergency.
 First, the process for obtaining a gold loan has been made quicker and easier with the use of technology, allowing for instant disbursals.
 Second, the eligibility requirements for a gold loan are less strict compared to other types of financing, with no need for strong credit or income documentation.
 Third, gold loans have a high loan-to-value ratio, making it easier to raise a substantial amount of money quickly.
 Fourth, the interest rates on gold loans are generally lower than other types of loans, such as personal or business loans, which can be helpful in a crisis.
 Finally, gold loan repayment options are flexible, allowing borrowers to make interest and principal payments as needed or pay the entire amount at once.
In addition to these benefits, gold loans have no end-use restriction, making them a suitable means of financing for both personal and family emergencies. Many households in India have gold in the form of jewelry or coins, which can be used to obtain a gold loan when the need for emergency cash arises.