Festival gold on EMI: cost, salary and the RBI rule

Banks and other RBI-regulated lenders may not give a loan to buy gold jewellery or coins. If a festival bill still ends up on borrowed money, an example ₹8,00,000 at 12% over 3 years costs ₹26,571 a month. You repay ₹9,56,556, of which ₹1,56,556 is interest. That EMI needs about ₹53,142 of take-home where total EMIs may reach 50% of income, or ₹66,428 at 40%.

Can you buy gold on EMI in India?

Not with a loan taken for that purpose. Under the RBI’s directions on lending against gold and silver, a regulated lender shall not grant any loan for the purchase of gold in any form, including ornaments, jewellery and coins. Lenders may lend against gold you already own, which is a gold loan — a different product.

So most “gold on EMI” offers at jewellers are instalment or savings schemes: you pay a fixed amount each month first and collect the jewellery at the end. Terms vary by jeweller. Read whether the gold rate is locked, what the scheme adds, and what happens if you stop paying.

The rest of this page shows what borrowed money costs at festival-bill sizes, so you can see the price of buying now and paying later in any form.

What borrowed money costs at festival-bill sizes

Gold and silver are trending this Navratri. At an example 22K metal rate of ₹13,600 a gram (₹1,36,000 per 10 grams), 20 grams of metal is ₹2,72,000 and 50 grams is ₹6,80,000. A jewellery bill adds making charges, wastage and GST on top, so the round amounts below are example bills, not quotes.

At 12% over 3 years: ₹3,00,000 costs ₹9,964 a month and ₹58,704 of interest, needing about ₹19,928 take-home at 50% FOIR. ₹5,00,000 costs ₹16,607 and ₹97,852, needing about ₹33,214. ₹8,00,000 costs ₹26,571 and ₹1,56,556, needing about ₹53,142. ₹10,00,000 costs ₹33,214 and ₹1,95,704, needing about ₹66,428. The rate and FOIR share are examples, not a quote or a rule.

EMI = P × i × (1 + i)^n / ((1 + i)^n − 1), where i = 12% ÷ 12 and n = 36 months

The same ₹8 lakh over 2, 3 or 5 years

Still at 12%, only the term changing on ₹8,00,000: over 2 years the EMI is ₹37,659 and total interest is ₹1,03,816. Over 3 years, ₹26,571 and ₹1,56,556. Over 5 years, ₹17,796 and ₹2,67,760.

Stretching from 3 years to 5 lowers the EMI by ₹8,775 a month and adds ₹1,11,204 of interest. In the first month of the 3-year loan, ₹8,000 of the ₹26,571 is interest and ₹18,571 reduces the loan. After 18 months you still owe ₹4,35,718.

Saving first versus paying later

Setting aside ₹8,00,000 over 36 months takes ₹22,222 a month, before any interest the savings earn. The 3-year EMI on the same amount is ₹26,571, so paying later costs ₹4,349 more each month — the ₹1,56,556 of interest spread across the term. The catch with saving first is that the gold price can move while you save.

How this differs from the ₹5 lakh personal loan EMI page

The ₹5 lakh personal loan guide works one fixed amount through tenures and rates. This page is for the festival season: the RBI rule on loans for gold, example gram and bill bands, the EMI on those bills, and the take-home salary those EMIs need. The same arithmetic applies to silver articles.

Card instalment and “no-cost EMI” offers can hide the interest in the price or a fee. Read the no-cost EMI guide before you count one as free, and the affordability guide for how FOIR fits your other EMIs.