Canara Bank plunges despite gold loan business vertical launch

The stock of Canara Bank slumped more than seven per cent on the bourses today after the bank announced that it has launched a special business vertical dedicated for gold loans with low interest, in order to provide hassle-free credit to its customers. The bank has launched this new product keeping in mind, the financial difficulties of its customers due to the current pandemic situation.

For this purpose, the bank has also launched a special gold loan campaign till June 30, with an interest rate of as low as 7.85 per cent per annum, minimum turnaround time (TAT) and high-flexibility to meet credit needs. It will help its customers in getting the much-needed liquidity to revive their business activities and manage day to day expenses.

Adding to this, the bank said that since Indians consider gold ornaments & coins as an asset, they can utilise their jewellery to avail credit for emergency cash in a crisis like this. The loans are payable within a period of one to three years with flexible repayment options and can be availed from all designated branches across India.

Gold loans for agricultural operations can be availed against gold ornaments with maximum borrowing limit of Rs 10 lakh for crop cultivation expenses. Meanwhile, for allied agricultural activities, gold loan can be availed in Rs 20 lakh as maximum limit per borrower, Besides, OD facility to farmers against gold jewellery can be availed with a maximum limit of Rs 20 lakh for harvesting & irrigational purposes and its loan amount can be repaid in three years.

At 3 pm on Monday, the stock of Canara Bank is trading at Rs 77.70, down by 7.50 per cent against its previous close of Rs 84.00. Its 52-week high is Rs 296.50 while, its 52-week low is Rs 73.85 on BSE.