Diwali is the season of celebration, shopping, and gifting. However, festive expenses can quickly pile up, and many people consider borrowing money to meet their financial needs.
Two popular options are gold loans and personal loans. Both have their advantages, but choosing the right one can save you interest costs, hassle, and long-term debt.
Here’s a clear comparison to help you decide which loan suits your Diwali plans best.
Gold Loan for Diwali Expenses
A gold loan is a secured loan where your gold jewelry acts as collateral.
Pros:
✅ Lower Interest Rates: Typically 7–10% p.a., much lower than unsecured personal loans.
✅ Quick Disbursal: Funds are usually released within 24 hours.
✅ Flexible Loan Amount: Loan depends on the current gold value — easy to get large amounts.
✅ No Credit History Hassle: Even those with low CIBIL scores can avail it.
Cons:
❌ Risk of Losing Gold: Failure to repay can result in auction of your pledged gold.
❌ Short Tenure: Usually 3–12 months, requiring repayment within a year.
❌ Limited Loan Amount: Depends strictly on gold value, which may not cover all expenses.
Personal Loan for Diwali Expenses
A personal loan is an unsecured loan that doesn’t require collateral.
Pros:
✅ No Asset Pledged: Borrow money without putting your gold or property at risk.
✅ Higher Loan Amount: Banks offer up to ₹25 lakh, depending on income and credit score.
✅ Flexible Tenure: EMIs can extend up to 5 years, easing repayment pressure.
Cons:
❌ Higher Interest Rates: Typically 10–18% p.a., making it costlier than a gold loan.
❌ Credit Score Dependent: Requires good CIBIL score for approval.
❌ Processing Time: Can take a few days compared to gold loan’s instant disbursal.
Which Is Better for Diwali Expenses?
Choose a Gold Loan if you need quick cash, lower interest rates, and have gold as collateral. Ideal for short-term shopping or emergency expenses.
Choose a Personal Loan if you need larger amounts, longer repayment tenure, and don’t want to risk your gold. Suitable for high-value purchases like home renovation or vehicles.
💡 Tip: Always calculate the total interest cost and your repayment ability before taking any loan during festive season.
Better Alternatives
Credit Card EMI Plans: Convert purchases into 3–6 month EMIs with lower interest.
Buy Now Pay Later (BNPL) Options: For small to medium expenses with flexible repayment.
Festive Savings Fund: Pre-plan monthly savings to cover Diwali costs — debt-free and stress-free.
FAQs
Q1. Can I take a gold loan and personal loan together?
Yes, but ensure total EMIs are manageable. Avoid over-leveraging during festive season.
Q2. Which has lower interest: gold loan or personal loan?
Gold loans are usually cheaper, around 7–10% p.a., while personal loans range 10–18% p.a.
Q3. Is gold loan safe during Diwali shopping?
Yes, if you repay on time and borrow only what you can comfortably return.
Q4. How quickly can I get funds?
Gold loans: same day or 24 hours.
Personal loans: 2–5 days, depending on lender and credit checks.
Conclusion
For Diwali 2025, both gold loans and personal loans have their place. If speed and lower interest are your priority, a gold loan is ideal. If flexibility and larger sums are needed, a personal loan is better.
The key is to borrow responsibly, plan repayments, and avoid turning festive joy into financial stress. Celebrate smartly, and keep your Diwali bright — not your debt burden. ✨💰
Published on : 18th October
Published by : SMITA
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