Loan Against Sovereign Gold Bonds from Tamilnad Mercantile Bank

Leverage the power of your sovereign gold bonds to pay off your debts

Tamilnad Mercantile Bank TMB Loan Against Sovereign Gold Bonds

This scheme helps borrowers get financial assistance to meet their personal needs by pledging their Sovereign Gold Bonds in the favour of TMB. This loan can be used to meet any personal needs such as expenses for a child’s wedding, child’s higher education, vacation, etc. as well as to consolidate debts.

Features of TMB Loan Against Sovereign Gold Bonds

Why this Loan?

  • The TMB Loan Against Sovereign Gold Bonds is meant for borrowers who want to get access to funds by pledging Sovereign Gold Bonds to meet their financial needs
  • This loan can also be availed by borrowers to pay off their high-interest debts, thereby consolidating their loans
  • This facility is offered as a term loan and overdraft facility

Loan Amount

  • As of October 2020, the maximum loan amount sanctioned by the bank under this loan scheme is not mentioned on the bank’s website. We suggest calling the bank customer care number to get more details


  • As of October 2020, the effective interest rate applicable to this loan may range from 8.45% to 9.75%


  • Term Loan: This loan is repayable within 2 years or the residual period of the Sovereign Gold Bond, whichever is earlier
  • Overdraft: This must be repaid within 2 years. It can be renewed on an annual basis subject to terms


  • All borrowers should be above the age of 21 years
  • The Sovereign Gold Bonds must be issued through TMB to be eligible for this loan

Margin Money (Borrowers Contribution to Total Cost)

  • The bank charges 25% of the value of Sovereign Gold Bonds at the time of sanction of the loan

Note: Margin money refers to the amount the borrower contributes to the overall amount required. The bank will cover the rest. So, if the total amount needed is Rs. 20 lakh, a margin of 20% means you will have to contribute Rs. 4 lakh. The bank will provide the balance of Rs. 16 lakh.

Security Needed

  • The bank accepts sovereign gold bonds to secure this loan

Processing Charges

  • The bank charges up to 0.50% of the loan amount plus tax for processing this loan with a minimum of Rs. 150

Documents Needed

  • Loan Application Form duly filled and signed by the applicant and co-applicant, if any
  • Two Passport Size Photographs of applicant and co-applicant
  • Personal ID Proof: Aadhaar Card, PAN Card, Passport or Driving License. PAN Card / PAN Card Issuing Letter is must
  • Signature Proof: PAN Card, Banker’s Verification, Driving License or Passport
  • Residential Address Proof (Any One): Aadhaar Card, Electricity Bill, Post-paid Phone Bill, Valid Rent Agreement
  • Income/Banking Proof for Salaried Professionals: Last 3 months’ salary slip, Form 16 or income tax returns
  • Income/Banking Proof for Self-employed Professionals/Insurance Agents: Computation of income of last 2 years, Balance Sheet, Profit and Loss Account, Registration Certificate, GST Return, Income Tax Challan/ Form 26AS/TDS Certificate, IT Assessment, etc.

Reference Facts

  • Tamilnad Mercantile Bank Website:
  • Headquarters: Tuticorin, Tamil Nadu
  • Call Centre Number: +91 461 2321382, +91 461 2321929, +91 461 2321932