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State Bank of Hyderabad is offering loans up to Rs 15 lakh to buy gold.
It has tied up with about 15 reputed jewellers in three States — Andhra Pradesh, Karnataka and Maharashtra — to offer loans to buyers from their outlets.
“Depending on the response, we want to expand this offering to major metros as well,” Mr M. Bhagavantha Rao, Managing Director, SBH, told newspersons after formally launching the product here on Thursday.
The loan-seekers can also apply for loans at the bank's branches.
The interest is at 13 per cent per annum and the loans have to be repaid in 60 months.
“We are targeting a business of Rs 100 crore by end of June this year,” Mr Rao told newspersons here on Thursday.
After receiving the margin money of about 25 per cent of gold value, the bank would finance the entire value of the gold which will be kept with it as mortgage.
The customers can take possession of their gold after completion of the loan term.
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