1 hr ago
Gold Loans Quadruple as India’s Untapped Gold Wealth Fuels Growth
Gold loans let people borrow money by promising their gold as security.
In India, this type of borrowing has grown almost four times in five years.
The market was worth ₹18.6 trillion in March 2026.
It grew partly because gold prices rose and businesses and individuals needed money.
Many small businesses and borrowers use gold loans because they can be approved quickly with less paperwork.
Southern states still have most of the market, but other states are growing faster.
Even so, only about 8% of Indian households’ estimated gold has been used for organised gold loans.
A report by Motilal Oswal Financial Services expects the market to exceed ₹30 trillion by March 2028.
India’s gold loan segment nearly quadrupled in five years to ₹18.6 trillion by March 2026.
The market grew 50% year-on-year in FY26, helped by rising gold prices and demand from households and businesses.
Only about 8% of the estimated ₹380–390 trillion worth of household gold has been monetised through organised gold loans.
Non-southern states including Rajasthan, Maharashtra and Uttar Pradesh recorded faster FY26 growth than the overall market.
Public sector banks hold about 60% of the market, while specialised gold-loan NBFCs increased their share to 8% by November 2025.
- Who
- Indian households, MSMEs, MFI borrowers, personal-loan customers, public sector banks and gold-loan NBFCs are involved in the expanding market.
- What
- India’s gold loan segment has nearly quadrupled in five years, reaching ₹18.6 trillion, while organised-market penetration remains about 8%.
- Where
- The growth is occurring across India, with southern states still dominant and Rajasthan, Maharashtra and Uttar Pradesh among the faster-growing non-southern markets.
- When
- The segment reached this level by March 2026; the report also gives FY26 and November 2025 market-share figures.
- Why
- Growth is being driven by higher gold prices, demand for personal and business funding, faster disbursal, flexible repayment and limited documentation.
Key facts
- Market size
- ₹18.6 trillion as of March 2026
- Five-year growth
- The gold loan segment nearly quadrupled
- FY26 growth
- 50% year-on-year
- Projected growth
- A 28% CAGR is projected for FY26–FY28, taking the market above ₹30 trillion by March 2028
- Household gold
- Indian households are estimated to hold around 28,000 tonnes worth ₹380–390 trillion
- Gold monetisation
- Around 8% of estimated household gold is monetised through organised gold loans
- Market leadership
- Public sector banks hold approximately 60% of the overall market
Quotes
Motilal Oswal Financial Services report
Financial-services research report cited by the article
“This shift reflects the gradual evolution of gold-pledging practices and cultural acceptance of gold loans across non-southern regions”
livemint.com
“Physical assets accounted for 64% of household savings in FY25, while savings in gold and silver ornaments rose 27% to ₹2.18 trillion”
livemint.com
Sources
Related news
Gold loans set for Rs 30 lakh crore by FY28
Indian Bank Gold Loan Portfolio Seen Surpassing ₹1.5 Lakh Crore
India’s Gold Loans Could Drive Consumption Despite Import Risks
Southern States Dominate India's Gold Loans with 80% Share
Gold Loan Boom Widens Gap Between Leading NBFCs
NBFC gold jewellery loans jump 69%; RBI reports record growth
Hexaware Names EXL Executive Vivek Jetley CEO as Srikrishna Exits
Foreign Investors Deliver India's Strongest Stock Inflow In 23 Months
Auto stocks plunge despite strong August sales and demand outlook
Brokerages See Up to 55% Upside in Seven Stocks
