Synopsis: According to the latest announcement by the RBI, silver will be eligible to be used as collateral for loans starting from April 2026.
With this new RBI rule millions of people will be able to use silver assets the same way as gold. Your silver rings, coins, or bars are not mere stored wealth, they can be converted into cash to suit your requirements.
Indian Households Hold The Most Gold Worldwide
The total amount of gold owned by Indian families is about 34,600 tonnes, which is valued at about 3.8 trillion dollars, a figure that is larger than that of any other nation or reserve bank in the world. It is a massive personal hoard that demonstrates that Indian culture and saving patterns are so deeply embedded in gold that it is one of the largest household wealth depositories in the world.
Prices Are Shooting Up!
Prices of gold and silver have been increasing day by day. The recent hike in the price of gold to record highs is an indication of increasing demand and uncertain economic circumstances in the world. Let us see how to simply utilize the idle gold and silver in your home and see how it can help you pay your daily bills.
1. Take Gold and Silver in Secure Loans
Borrowing without selling your gold or silver. These loans are a viable alternative to meet the emergency or business requirements through the attractive interest rates and quick processing. The new guidelines of RBI will guarantee the security and ease of lending based on silver next year onward
How it works:
- You secure your gold or silver by putting a pledge with a bank or NBFC.
- The lender evaluates the worth and lends a loan up to a certain percentage- normally 75 percent of the worth of the asset.
- To recover your assets you pay the loan plus interest.
Risks:
- Market fluctuations: A decline in the price of gold or silver will put the loan-to-value ratio in an undesirable position and may lead to foreclosure.
- Interest charges: The interest rates can be too high thus lowering the overall returns in case the asset is secured over a long term.
- Default risk: The default on repayment may result in the loss of pledged assets.
2. Monetise Stagnant Resources through Schemes
Safe interest on Gold deposit through Gold Monetisation Scheme. In the case of silver, other schemes like these are coming up to assist you in realizing revenue on your holding.
How it works:
- deposits gold/silver to the bank.
- Get interest during a predetermined period (1-3 years).
- You may withdraw or renew the deposit when necessary.
Risks:
- Market risk: There is a risk that you will receive less interest or penalty in case you withdraw early.
- Scheme discontinuation Schemes are subject to change, including scheme availability or returns.
3. Sell Old Silver & Gold
Capitalize on expensive costs by selling scrap or unworn jewelry to reputable dealers or online reputable sites to get immediate cash.
How it works:
- Figure out reputable dealers or websites.
- Sell old, scrap or excess jewelry to get instant cash
Risks:
- Price fluctuations: When the market goes down, sell it at low prices.
- Quality issues: Probability of being underpaid in the event that the purity check is erroneous.
- Scams: Transacting business with unreliable or unchecked buyers.
4. To Digital, Investment Products
Purchase or sell online silver and gold in the form of an ETF. They are flexible, safe, and good returns without storage hassles .
How it works:
- Invest on the internet through ETF.
- Shop and sell anywhere at any time.
- Bonds are paid a fixed interest; ETFs follow gold/silver prices.
Risks:
- Market risk: The prices vary with international markets.
- Liquidity: Minimal in crashes of markets; can sell at a loss.
- Fees: The amount of profits may be lessened by transaction costs
5. Save on Jewelry & on Making Charges
Replace old jewelry with new stylish jewelry. This is more convenient when the metals are on the high price thus you get maximum profits.
How it works:
- Alter old jewels with new ones from jewellers.
- Make a markup on differences in craftsmanship and design.
Risks:
- Profiling: Charges may be excessive, profit margins decreased.
- Market price risk: You may not get the best deal in case the prices of gold/silver are volatile.
- Sensational value lost: Uses of physical and emotional attachment in the course of an exchange.
Why Act Now?
As the prices have gone skyrocketing and with new financial products in the market, your neglected gold and silver in the house are good assets that can be mobilized. Did you want to take loans, get returns on investments or access cash fast, then these metals can now help you achieve your financial objectives. Get all those gold and silver in your possession, and make it count–get your treasure room filled up!
Written By Jayanth R Pai