When Your Gold Loan Becomes A Non-Performing Asset

What Is Non-Performing Asset (NPA)?

A gold loan becomes an NPA when the dues remain unpaid for more than 90 days.

The 90-Day Rule

Missing payments for over three months signals serious default risk to lenders.

Why It Matters

NPA classification turns your loan into a high-risk financial liability.

Auction Threat Begins

Lenders can initiate an auction of pledged gold to recover pending dues.

Credit Score Impact

Defaults damage your credit score, significantly affecting your future borrowing ability.

Debt Keeps Growing

Penal charges and interest continue adding to your total outstanding amount.

Legal Consequences

Continued non-payment may lead to legal recovery actions from lenders.

Loan-to-Value Effect

Falling gold prices may increase risk if loan-to-value limits are breached.

How To Avoid NPA

Pay dues on time or restructure repayment before delays cross limits.

Act Before Default

Early action helps protect your gold, credit profile, and financial stability.