Gold Loan Policy – Dashami Finance

Reviewed in the meeting of Board of Directors Held on 26/07/2025

This policy aiming to create a complete gold loan policy document for the Board’s approval. The goal is to keep improving loan quality, increasing net interest margins, and making operations more efficient, especially in following rules and managing risks.

1. Compliance Structure

As an NBFC registered with RBI, our gold loan lending policy follows RBI’s guidelines. This policy will be reviewed and updated as RBI changes its rules.

2. Risk Management

We have zero compliance policy on risk. Auditors, Vigilance officer, regional managers, Audit managers have routine visit at the branches to ensure zero compliance and quality of the checking.

3. Standardization of Value of Gold

The company lends varying amounts per gram of the gold (LTV) depending upon the market value and the purity of the gold. As per the risk assessment of the company a higher LTV is riskier than a lower LTV. Accordingly, lower LTV attracts lower rate of interest and higher LTV attracts higher interest rate. Further, in case of schemes where the interest rate varies with tenor of the loan, the borrower can remit the monthly interest alone and continue to enjoy the loan at lower interest rate.
In terms of RBI guidelines, maximum LTV rate that can be fixed should not exceed 30day average of the closing rate for standard gold (22k) fixed by India Bullion.
The maximum permissible LTV (Loan-to-Value) of the pledged ornaments will, however, be within the ceilings stipulated by RBI from time-to-time (The maximum permissible LTV is 75% at present). The company will maintain a Loan-to-Value (LTV) Ratio not exceeding 75 percent for loans granted against the collateral of gold jewellery throughout the tenor of loan
If the purity of the gold is less than 22 carats, then translate the collateral into 22 carat and state the exact grams of the collateral. In other words, jewellery of lower purity of gold shall be valued proportionately subject to the condition that the purity of the ornaments is not below 19 carats.

4. Customer identification & KYC verification

Establishing the identity of a person who approaches us for gold loan is a pre-requisite for granting gold loans. Customer identification involves personal interaction with the customer and verification of his/her identity, as also the current/ permanent address by verification of reliable, independent documents prescribed. For customer identification, a combined Photo ID cum Address proof or in its absence two independent documents with Photo ID and Address proof are mandatory. Normally, persons residing/having work place within 10 kms radius of the branch may be accepted as customers.

Both the address and ID Proof should be collected. If both the ID and address proof are in a single KYC document like Passport, driving license etc., one copy of the same is enough. The entire details of the entered customer details should match with the KYC obtained and ensure that the documents collected are self-attested. The Branch in charge will verify the copy with the originals and attest with their signature and filed in the order of the client ID. Live image of the customer will be capture at the time of gold loan

Any one of the following documents having photo and address proof may be obtained. Pan card required to be collected from customer in case customer does not have pan card form 60 should be obtained.

Combined ID cum Address proof

In the case of Passport and Driving License, date and place of issue, expiry, etc. have to be verified to ensure that they are valid and genuine.

5. CENTRAL KYC RECORDS REGISTRY

The objective of setting up the CKYCRR was to have a Centralized Repository of KYC records of customers in the financial sector (across the Regulated Entities of all the Financial Sector Regulators viz RBI ,SEBI, IRDAI & PFRDA) with uniform KYC norms and inter-usability of KYC records across the financial sector to reduce the burden of producing KYC documents and getting those verified any time when the customer creates a new financial relationship with a financial entity.

The consent should be obtained from customer for downloading the CKYC.

6. Selection of scheme / Eligibility

Once the customer identification is complete, the counter staff shall explain to the customer the salient features of various schemes as also the terms of interest and period of servicing. Most suitable scheme to meet the requirement of the customer may be suggested. However, the selection of a particular scheme should be left to the choice of the customer.

7. Loan Amount

If the loan amount required is 20k and more the loan amount can only disburse to the customer account only.

8. Customer Bank Details

This is mandatory to obtain the customer bank details and update in the software.

9. KYC Compliance

Obtain Xerox copy of the ID Proof and address proof and get the signature of the customer. Manager shall verify the same with the original and sign after affixing the stamp “Original Verified”.
Fill up all the particulars in the KYC Form accurately and obtain signature of the customer on the KYC Form. Once the KYC Form is filled up, a customer ID Number should be generated from the system and entered in the KYC Form.
KYC Form together with the ID proof should be filed serially and kept intact.
A brief root sketch should be drawn from the branch to customer house.
KYC Register should be maintained.

10. KYC Data Sheet & Application Form

When creating KYC, the branch must fill the KYC data sheet and attached with customer KYC. An application form provided. For the gold loan the branch must collect the application form from the customer and the same must be attached with gold loan pledge form.

11. Ownership Declaration & Annual Income statement

To be filled and collect customer signature on the ownership declaration and annual income statement form.

12. Appraisal of ornaments

This is the primary responsibility of the branch is ensuring the purity and exact weight of the ornaments, for the purity checking obtain the gold from the customer in a tray provided for the purpose. Each ornament should be undergone purity checking using the different appraisal methods. The weight of stones, dust, plastics other than gold associated with ornaments should be properly deducted.

The ornaments should verify both custodians and sign in the prescribed places, Weights should be marked and entered in the system and TEE cover. The branch manager should verify each and every gold ornaments irrespective of the two appraisals.

13. System Entry

KYC must create in the system; the live photo should be uploaded along with customer data and KYC documents.

The loan should be entered in the system as per the selected scheme by the customer and purity, weight deduction must be entered in the system. The agreed loan amount should be confirmed and entered in the system. The customer live photo and ornament photo should be captured. The TEE cover number, pledge form number along with the required data should be inserted. The tier weight should be entered after sealing the packet by BM and First Custodian. The pawn-tickets & Voucher should be generated and printed from software. The loan should be approved by BM in the software.

14. Gold Loan Disbursement

The pawn ticket and Gold along with the unsealed TEE cover should be verify Both manager and second custodian once again and seal the packet with the presence of both custodian and take the tier weight and entered in the software. We have software sanction in our system the sanction must be done by BM.

Customer signature should be obtained in the prescribed places of the pawn-tickets; the cashier must collect signature on the voucher and cash denomination should be mentioned. The customer copy should be handed over to customer and educate them the customer copy is necessary for the closure if the form misplaces, they should do indemnity for the loss of the token. Branch should file the branch copy.

15. Bank Transfer

Loan amount 20 k and above should be transferred to the customer bank account. The bank details should be verified and confirmed by BM. If the branch is integrated with the bank account the payment is automated. On other hand the BM should intimate the loan payment to the accounts department through the recommendation of prescribed hierarchy

Operations Department
Accounts Department

he branch should follow the gold loan approval hierarchy.

Branch must send an email request for the fund transfer with the flowing attachments :

16. Sanctioning powers

Following are the sanctioning powers vested with the various functionaries for sanctioning of gold loans with attendant control measures.

SI No	Sanctioning Authority	Sanctioning Powers
01	Branch Manager	Single loan – up to 3 Lakhs
02	Regional Manager	Single loan above 3 lakhs to 5 lakhs
03	State Head	Single Loan Above 5 Up to 10 Lakhs
04	General Manager	Above 10 Lakhs

Sanctioning authorities at different levels are required to analyze and ensure the ownership of gold pledged, repayment capacity of the customer before sanctioning the loan. A record of loans sanctioned to be maintained by sanctioning authorities in excel (in system) for Furth reference/verification.

For 10 lakhs and above loans can be disbursed after the gold verification from audit department

17. Storage and Insurance

The pledged gold shall be stored systematically, serial number wise to facilitate easy check and location. The pledged ornaments will be stored in vaults. The vaults/Strong room shall have a double lock system. There shall be two keys for operating the vaults/strong room, entrusted to two separate officials, one to the Branch Head (custodian) and the other to a senior official (Joint custodian) in the Branch. The vaults/strong room can be opened only when the two keys are used.

An insurance must be taken duly for theft and fire.

18. Security System

Security features like CCTV Camera and Burglary alarm must be implanted entire branch

19. Field Verification Report (FVR)

Branches shall conduct field verification within one week from date of sanctioning loan and submit the FVR duly filled and signed by the below competent authority.

20. Closure of gold loans

Customer has to handover the customer copy of pledge form to the executive.
The executive, on getting the customer copy, taking out the branch copy of the pledge form from the file.
After checking the interest due on the loan from the system, inform the customer the total amount for the closure of the gold loan and confirm the amount they have possess and mark the same on the pledge form.
If the closure amount is 20000 or more the closure amount can only accept through the bank account only. The payment musty me from the customer own bank account.
The customer makes cash payment at the cash counter.
On getting cash payment, the cashier affix cash received seal on the pledge form, enter the details in scroll, system and handing over the pledge forms to the Branch Manager.
If the customer paid through bank account confirm the amount us received to the bank, then only the loan can be closed in the system. If the loan amount is not credited on the same day of closure the next day interest should pay by the customer. if the payment is made from online payment application the branch should collect the payment receipt screen shot from the customer for the verification of the corporate officials.
The Branch Manager checks the details, makes the entry in his scroll, getting signature of the customer in the pledge form, affixing account closed seal on the pledge form and handing over the ornaments to the customer.

21. Third-Party Gold Release

The third party must have a verifiable and bold relationship with the customer (e.g., immediate family member or equivalent).
The physical presence of the third party at the branch is mandatory for verification purposes.
Authorization Letter from the Customer: A formal letter authorizing the third party to collect the gold, duly signed by the customer.
Third-Party KYC Documents: A valid KYC should be possessed by the third party; the KYC must be filed with the loan token along with authorization letter.
Customer copy is Mandatory for Third party release.

22. Closure of gold loans in the event of token lost/token misplaced

Release of pledges without tokens is a very sensitive area and requires more attention. The Branch Manager should ensure that the release of ornaments is made to the customer only who has pledged them. Following are the precautions to be taken for such releases. (In all cases, aggregate loan outstanding in the name of a customer is to be considered)

An indemnity in Rs.200 stamp paper in the name of the customer to be obtained. The indemnity value can according to the statutory guideline.
If the customer comes for release of more than one loan a day without token one Rs.200-rupee stamp paper is enough for all the loans.
In token loss case customer should be come for the loan closure, no third-party release not allowed

23. Release of ornaments of Deceased borrowers

The ornaments pledged by a borrower who dies during the currency of the loan can be released to the legal heir/s on closure of the loan accounts by making payment of principal amount and interest up to the date settlement of claim.
The discretionary powers delegated to various functionaries are as under (In all cases, aggregate loan outstanding in the name of a customer is to be considered)

Functionary	Gold Loan Amount
Regional Manager	Up to Rs.25000/-
State Head	Rs.25000/- and above up to Rs.1.00 lac
Operations at Corporate Office.	Rs.1.00 lakhs and above

Documents to be obtained

Succession Certificate from a competent Court of Law.
Letter of Indemnity on Stamp Paper of adequate value indemnifying the company against loss if any.
Letter signed by all legal heirs authorizing one of them to receive the ornaments on their behalf if all of them cannot be present in the branch at the time of release.

In all cases, photo ID proof of the legal heir/s and customer copy of pledge form are compulsory. (Where token is not produced rules for token lost cases will also applicable)

All the documents pertaining to the claims settled under the discretionary powers of the branch manager or sanctioned by Corporate Office are to be kept serially numbered in a separate file by the branch under safe custody for verification by Audit officials.

24. Staff gold loans

The Staffs other than branch managers/Branch head/temporary branch head can avail gold loans from their parent branch with the following conditions

For Staff gold loans other than branch in charge should forward their application with their concerned regional manager’s recommendations to Operations department at corporate office for sanction. Branch should submit the proposal with staff details and customer ID, proposed limit, Existing limit etc.
Products/schemes/rate of interest etc. as per product parameters.
Apprising to be done by a staff other than the borrower staff
BM should ensure prompt remittance of interest on monthly basis.
No rebate will be applicable to staff loans
special marking to be done on the pledge form also in the gold packet as “staff loan”
For staff loan approval must be taken from GM
Product/Schemes/Interest rate etc. as per product parameters.
Borrower staff should not involve in any part of apprising/sanctioning process.
BM should follow-up and ensure prompt repayment on monthly basis.
No rebate will be applicable to staff loans.
Special marking to be done on the pledge form and ornament packet as “Staff Loan”.

25. Auction Procedure

For the eligible loans, intimation is sent to the borrowers. A notice message in the local language is sent to the borrowers (eligible for auction account) by registered post with acknowledgement additionally an electronic message is also send requesting them to pay the full dues as and when the accounts become NPA. If the customer fails to settle the dues even after 30 days from the due date, the Company shall send a registered auction notice with acknowledgment due, requesting the borrower to immediately pay the full dues, failing which the security would be liable to be put on public auction/e-auction, without further notice, for recovery of dues.

The list of accounts taken up for auction shall be announced through advertisement in National daily and in a vernacular language. Such notification in the newspapers should be published at least 14 calendar days before the scheduled auction date.

26. Filing of Police Compliance

In all incidents where the commitment of fraud has been detected/confirmed. police complaint should compulsorily be filed against those involved in the following instance, Amount involved in fraud is Rs, I O, 000 /- & above, committed by staff/ customers/external parties. The above instructions are in line with the RBI’s Directions/Circular (Master direction: “Monitoring of frauds in NBFCs directions. 2016 DNBS. PPD.01/66.15.001/2016-17. dated September 29. 2016 and Master Circular: “Future approach towards monitoring of frauds in NBFCs, DNBR (PD)cc. No 058/03.10 19/20 15-16) on reporting requirement concerning fraud.