Gold loan: Gold loan is emerging as a rapidly growing credit segment in India, with a growth of up to 125 percent on an annual basis till the end of November. This has been revealed in the report of Reserve Bank of India (RBI).

The rise in the price of gold in recent months is a major reason for this. When the price of gold increases, the number of gold loans also increases because the value of the pledged gold increases. With this, people get more loans at higher rates. In such a situation, it is becoming famous among those seeking short-term credit.

Why is the demand for gold loan increasing?

Over the past year, gold loans have consistently outperformed all other retail loan categories. RBI data shows that outstanding gold loans increased from Rs 898 crore in November 2023 to Rs 1.59 lakh crore in November 2024 and more than doubled to Rs 3.5 lakh crore by November 2025.

The interesting thing is that in the last six months its growth rate has doubled on an annual basis. In the year 2025, gold prices will increase by about 64 percent. During this period, the price of 10 grams of 24 carat gold reached approximately Rs 1.35 lakh. Due to this the demand for gold loan also increased. With the increase in the price of gold, its value per gram also increases, due to which people are able to avail the benefit of more loan in exchange of less gold.

Banks’ share in gold loans increased

Manish Mayank, head of gold loan business at IIFL Capital, says, “This rapid growth reflects a structural change in the way domestic customers and small businesses are taking loans.” He said that getting a gold loan is also easy as it requires less documentation and due to the fast processing, it quickly meets the working capital needs. Moreover, gold loan is secured. Unlike an unsecured personal loan, there is no risk in it.

This is the reason why banks are also emphasizing on increasing their share in the gold loan category, leaving NBFCs behind. The situation is that even though the gold loan portfolio of NBFC has reached about Rs 3 lakh crore, the bank is ahead in terms of market share. The share of banks in the gold loan market has now reached 50.35 percent. The remaining share is with companies like Muthoot Finance, Manappuram and IIFL Finance.

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The direct impact of the recent fall in gold and silver prices is now being seen on gold loan companies. Shares of Muthoot Finance have fallen by about 3% and Manappuram Finance by about 1.45%. Muthoot has slipped nearly 6% from the all-time high made in October, while Manappuram has also fallen by about 5%. In the last few months, when gold prices had increased, there was a tremendous rally in the shares of these two companies. The reason was clear – when gold prices increase, the loan value and collateral value also increases, which increases the revenue growth expectations of these companies. But now due to stoppage of bullion rally and return of risk-on sentiment of investors, pressure on Gold Loan stocks has increased. Despite this, so far in 2025, Muthoot Finance has registered a gain of about 49% and Manappuram Finance has registered a gain of about 50%. Meanwhile, gold prices on MCX recovered 3% on Thursday to reach an intraday high of ₹1,24,233 per 10 grams.

Gold Loan Demand in India 2025: The continuous rise in gold prices has troubled people. At the same time, investors are also getting attracted towards gold due to this rising price. Indian investors have been considering gold as a safe investment option since the beginning and have invested in it. Gold prices have created new records during the festive season.

Along with buying gold in India, the number of people taking loans against gold pledge has also increased significantly. According to the latest data, in the last 5 months, Indians have taken gold loans worth Rs 97,079 thousand crore. RBI data shows that in August 2025, an annual increase of 117.8 percent was recorded in the number of gold loan takers. This data shows that Indians are attracted towards gold loans.

Know the status of gold loan from data

According to the released data, gold loans worth Rs 2,08,735 crore were given till March 2025. There was a tremendous jump in these figures in the month of July and it reached the figure of Rs 2,94,166 crore. That means, in a span of just 4 months, Rs 85 thousand crores were taken as gold loans.

This growth was also seen in the month of August and in this month a loan of Rs 12 thousand crore was taken. Experts say that people are taking the help of gold loan to meet their financial needs. Due to the increased prices of gold, loans are easily available to them.

Why is the number of people taking gold loans increasing?

The rising prices of gold have increased the rate of taking gold loans. Gold prices are skyrocketing. Which means that people are getting more money in the form of loan in exchange for gold. Moreover, taking a gold loan is easier than taking other loans. The number of people taking personal loans in banks is already very high. In such a situation, banks are giving priority to those with gold loans. Because their line is not very long. Besides, banks are also sure about loan recovery.

During the festive season, people have used gold loan as an easy option to meet their needs. About 85 percent loan on the value of gold is easily available through non-banking financial and banks and it is also economical compared to other loan options. That is why, people are getting attracted towards gold loan to meet their needs.

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Gold Loan: The Reserve Bank of India (RBI) made major changes in the rules of gold loan on Friday, which are going to be implemented soon. These new rules include the increase of LTV ratio, exemption from credit appraisal to gold loans up to Rs 2.5 lakh. Another rule is talked about implementing, under which gold loan will be available only after showing the receipt of buying gold jewelery.

If there is no receipt?

The RBI has said in its draft proposal that the bank or NBFC will not give a loan if there is doubt about the gold loan ownership. That is, if you are thinking of taking a loan in lieu of it by pledging gold and taking a loan, then first you have to show the receipt.

Suppose if you do not have an original receipt, then you have to give self-dealing. That is, you have to prove that you have inherited jewelry and you still own it. Actually, the bank or NBFC will keep the pledge of gold being pledged to keep the pirate verification with them.

What about the inherited jewels?

Many times we get gold ornaments from our parents or on the occasion of marriage. In this situation, the possibility of receipt of receipt is negligible, so can the acer gold jewelery be pledged and cannot be taken?

The answer is that if you have inherited gold jewelry and do not have a receipt for it, you can still get a loan, provided gold is real and valid. In this situation, landers will check things like gold purity, weight, market value. Apart from this, keep the documents required for applying for the loan such as PAN card, Aadhaar card, address proof, passport.

The aim of RBI is to provide loans in a transparent manner to customers with small debt so that they get both more confidence and security. Along with this, fraud and money laundering can also be banned. On April 9, the Reserve Bank issued a draft of new rules of gold loan. In cases of gold loan, RBI wants to set a similar rule for bank and NBFC so that customers do not have any kind of confusion or trouble.

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Gold Loan: The Reserve Bank of India (RBI) has made a big change in the rules of taking gold lone on Friday. This has brought relief to small borrowers. In fact, the Reserve Bank has decided to increase the loan-to-value (LTV) ratio from 75 percent to 85 % for gold linen up to Rs 2.5 lakh.

What does it mean to grow loan-to-value ratio?

This means that if you are pledging gold worth Rs 1 lakh, then instead of the earlier 75,000, you will get a loan of up to Rs 85,000 on it. This will facilitate small businessmen or middle class, who take loans in exchange for gold to meet their small needs.

Lon-to-Value (LTV) is the ratio, which determines how much percentage you can take at the cost of gold. If you have gold worth 1 lakh with this decision of the Reserve Bank, then you will get a loan of up to Rs 75,000 and if you have less than 2.5 lakh rupees, then you will be able to take a loan up to 85 %.

The shares of these companies boom

Since the process of gold loan is fast, you can take a loan by mortgaging the gold with you if you suddenly needed money. Gold is also seen as a safe investment to get a difficult clock financial help.

Here, after this announcement of the Reserve Bank, there was a stir in the shares of the gold loan companies. Shares of Gold Loan Company Muthut Finance went up to Rs 2470 with a 7 percent lead today. Similarly, the shares of Manapapuram Finance also saw an increase of 5 percent and the price reached Rs 246.48. Whereas with a rise of 4.50 percent, IIFL Finance shares reached a level of Rs 452.45.

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Gold Loan: The trend of pledging gold jewelry in India has increased somewhat than before. The data of the Reserve Bank of India (RBI) shows that by March 2025, the outstanding bank loans in lieu of gold have exceeded double. It has increased from Rs 1 lakh crore to 103 percent to about 2.1 lakh crore rupees. With this bounce, the gold loan has become the fastest growing segment.

Agricultural loans in lieu of gold jewelry

In fact, in 2023, RBI directed all banks to give agricultural loans in lieu of gold jewelery so that the farmer can meet his agricultural needs. Perhaps this is why the number of gold loans has increased. However, the loan given by banks in FY 2025 has come down from 20 percent to 11 percent as compared to last year. Typically, keeping the loan found in rural areas in lieu of gold in the category of agriculture credit benefits banks because one is low in interest rates and the terms of repaying it are also easy.

RBI banned NBFC on giving gold loan

After the Reserve Bank imposed a ban on granting loans on some major non-banking financial institutions, people turned to banks for this.

That’s why people are taking gold loan

On the other hand, due to the increase in gold prices, the number of people taking gold loans has also increased as more funds are being demanded according to the current market price instead of mortgaged jewelery. Despite the bounce in the gold loan, the borrowing has decreased. By the end of March 2025, the outstanding loan of banks has reached 182 trillion rupees.

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