In this option, the overdraft facility is the gold loan amount. It is very similar to credit card spending. This means that you can spend as much as you need, anytime and anywhere, but there is still a credit limit. The interest rate shall be applicable only for the amount you use, not the whole amount you are given.
When you deposit your gold with banks and other lenders, you are given an overdraft account in which the loan is credited. Some banks do allow the withdrawal of the money with a debit card from any ATM of any bank. Some banks link this account with your savings account, or just open a new overdraft account. There are some lending institutions that open new accounts with features and benefits like a current account. You can also withdraw with cheques. In this case of overdraft facility gold loans, the interest rate is higher.