What is gold loan software?
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Gold loan software is a specialized pawn broking management system that helps businesses manage gold loans, calculate interest automatically, track customer records, print pawn tickets, and maintain complete accounting reports. It replaces manual ledgers, Excel sheets, and generic accounting software with a purpose-built digital system designed for gold finance operations.
How do pawn brokers calculate gold loan interest?
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Pawn brokers calculate interest either monthly or daily based on the loan amount and applicable interest rate. The standard formula is: Interest = (Principal × Annual Rate × Number of Days) ÷ 365. For example, a ₹50,000 gold loan at 12% per annum for 30 days would accrue ₹493 in interest. Use our free Gold Loan Interest Calculator for instant accurate calculations.
What is the maximum Loan to Value (LTV) for gold loans in India?
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As per RBI guidelines, the maximum Loan to Value (LTV) ratio for gold loans is 75% of the gold's market value for banks and NBFCs. This means for gold worth ₹1,00,000, the maximum loan sanctioned is ₹75,000. Some state-registered pawn brokers may operate under different state government regulations. Use our free LTV Calculator to determine the maximum eligible loan amount.
Is pawn broking software better than Excel or Tally for gold loan management?
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Yes, dedicated pawn broking software is significantly better than Excel or Tally for managing gold loans. Excel cannot automatically calculate daily interest, print pawn tickets, or send customer SMS reminders. Tally is a generic accounting tool not built for gold loan workflows. Purpose-built gold loan software offers automatic interest calculation, multi-branch support, gold purity tracking, KYC management, and complete audit trails that Excel and Tally simply cannot provide.
Do I need a license to start a gold loan or pawn broking business in India?
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Yes. In India, pawn brokers must obtain a license under the respective State Pawn Brokers Act. Requirements vary by state. In Tamil Nadu, pawn brokers are licensed under the Tamil Nadu Pawn Brokers Act. For NBFC-based gold loan operations, RBI registration is mandatory. Read our complete guide on Pawn Broking License in India for state-wise requirements and the application process.