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AllBank expands gold loan scheme

New game plan

Calcutta, July 3: Public sector Allahabad Bank is planning to roll out its scheme to lend money against gold as collateral across the country.

As part of the initiative, the Calcutta-based bank has identified around 25 branches in the city and its suburbs for the scheme.

“A large part of our gold loan business is concentrated in south India. Now, we are planning to expand in other parts of the country as well. We have started in the east and will expand further,” Ashok Chatterjee, general manager (retail credit) of Allahabad Bank, told The Telegraph.

The bank today launched its gold loan scheme at the Gariahat branch.

He said the necessary infrastructure would be built at the identified branches to help them start lending under the scheme.

According to Chatterjee, the bank has set a competitive interest rate, which would attract more retail customers. “Often retail customers look for quick credit and domestic gold could be used for availing such credit,” he said.

“We are offering an interest rate of 12 per cent, which is lower than what is charged by various private companies. The loan tenure is for five years,” Chatterjee said. NBFCs, which also offer credit against gold, charge an interest rate of around 18 per cent.

At present, the bank has a gold loan portfolio of around Rs 200 crore and plans to expand it this fiscal.

Allahabad Bank is looking to increase its retail portfolio on account of low demand of credit from the corporate sector.

 
 
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