Gold ornaments are physically weighed to determine their gross weight. Deductions are made for stones, threads, lac, solder and other non-gold components. Only the actual gold content is considered for valuation.

Net Gold Weight = Gross Weight − Stone Weight − Solder and Other Non-Gold Deductions

Example: If the gross weight is 20 grams and the total deductions are 2 grams, the net gold weight will be 18 grams.

Gold ornaments with purity ranging from 18 to 22 carats are accepted as collateral. Trained gold appraisers assess purity using standard testing methods, including touchstone, nitric acid and saltwater tests. Filing tests may also be conducted wherever required, depending on the type of jewellery.

The assessed purity is recorded as part of the loan documentation.

Note: Touchstone, nitric acid and saltwater tests are part of the standard purity assessment process. Additional tests may be carried out depending on the type and condition of the jewellery.

The gold rate is determined by considering the lower of the following prices published by the India Bullion and Jewellers Association Ltd. (IBJA):

• Average closing price of gold for the preceding 30 working days.
• Closing price of gold on the immediately preceding day.

Gold of purity below 22 carats is converted into its equivalent 22-carat weight for valuation.

The eligible loan amount is calculated based on the 22KT equivalent net gold weight, applicable gold rate and LTV ratio, as per RBI guidelines and the Company's approved Gold Loan Policy.

Loan Amount = 22KT Equivalent Net Gold Weight × Applicable Gold Rate × Applicable LTV (%)

Illustration: For a 22KT equivalent net gold weight of 15 grams, a gold rate of ₹12,500 per gram and an LTV of 85%, the eligible loan amount would be:

15 × ₹12,500 × 85% = ₹1,59,375

This methodology is followed uniformly across all branches to ensure consistency and transparency in gold valuation.