Report Overview

India Gold Loan Market – Industry Trends & Forecast Report, 2031

India Gold Loan Market size was estimated at USD 83.69 billion in 2024. During the forecast period between 2025 and 2031, India Gold Loan Market size is projected to grow at a CAGR of 16.50% reaching a value of USD 243.77 billion by 2031. Prominent drivers of the market include the increasing preference for gold loans due to their quick disbursal, minimal documentation, and flexibility in repayment. Gold loans have gained significant traction in India, primarily managed by banks and NBFCs, offering an accessible financing option. The rising gold prices have further enhanced borrowing capacity, while economic uncertainties drive individuals to seek gold loans as a reliable liquidity source. Additionally, supportive government policies, including tax benefits, and advancements in digital platforms have streamlined the loan process, making it more convenient for borrowers. With Indian households holding an estimated 25,000 tons of gold, the market is poised for sustained growth. For instance, bank gold loan disbursals surged by 71.3% year-on-year in the first nine months of FY25, reaching INR 1.72 trillion. This growth was primarily fueled by rising gold prices and a slowdown in unsecured lending after the Reserve Bank of India (RBI) increased risk weights on such loans in November 2023. Between April and December 2024, gold loan growth jumped by 68%, closely aligning with a 21% rise in gold prices during the same period. Also, the reclassification of certain agricultural loans as gold loans has further contributed to the market’s expansion. For instance, with gold prices reaching INR 75,857 per 10 grams in December 2024, borrowers have been able to secure higher loan amounts. Recognizing this sharp upward trend, the RBI’s financial stability report has prompted financial institutions to reassess their lending policies and ensure compliance with regulatory guidelines, reinforcing the gold loan market’s steady growth trajectory.

Gold Loan – Overview

A gold loan is a secured loan where individuals pledge their gold ornaments or jewelry as collateral to obtain funds from banks or NBFCs. It offers quick disbursal, minimal documentation, and flexible repayment options, making it a popular financing choice in India. The loan amount is determined based on the gold’s value, influenced by market prices. Interest rates are generally lower than unsecured loans due to the collateralized nature. Gold loans are widely used for emergencies, business needs, and personal expenses. With rising gold prices and digital advancements, the gold loan market continues to grow as a reliable liquidity source.

India Gold Loan Market

Growth Drivers

Rising Gold Prices

The surge in gold prices has significantly contributed to the expansion of India Gold Loan Market, making gold loans one of the fastest-growing segments in personal lending. According to recent data from the Reserve Bank of India (RBI), the total gold loan portfolio held by banks reached INR 1.7 lakh crore, marking a substantial 68.3% growth in the current financial year. The primary drivers behind this trend include the increasing value of gold, which enables borrowers to access higher loan amounts using their gold assets as collateral. Additionally, shifting regulatory policies have led to a growing preference for banks over non-banking financial companies (NBFCs) in gold loan disbursement. As of October 2024, banks commanded 82% of the market share, while NBFCs held only 18%. Muthoot Finance, India’s leading gold loan NBFC, continues to strengthen its presence in the sector. Recently, the company received approval from the Reserve Bank of India (RBI) to expand its branch network by adding 115 new branches. This move aligns with the growing demand for gold-backed credit, particularly in underbanked regions, and reflects the company's commitment to financial inclusion. Also, economic uncertainties and financial constraints have driven households to rely more on secured gold loans. Unlike unsecured personal loans, gold-backed lending provides a quick and accessible credit option with lower risk. This has fueled demand in both urban and rural areas, where gold remains a trusted financial asset. With gold prices continuing to rise and leading players like Muthoot Finance expanding their reach, India Gold Loan Market is expected to further growth, solidifying its role as a crucial financial segment for borrowers seeking liquidity.

Challenges

Increasing Risk of Defaults

India Gold Loan Market has long been a preferred financing option due to its quick disbursement, minimal documentation, and gold-backed collateral. However, the rising risk of loan defaults could significantly restrain the market growth, with gold loan non-performing assets (NPAs) surging by 30% in June 2024, reaching INR 6,696 crore from INR 5,149 crore in just three months, according to the RBI. Economic challenges have strained borrowers' repayment capacity, as many individuals pledge their gold to cover essential expenses such as household needs, education fees, and medical costs. The surge in gold prices has further driven demand, pushing outstanding gold loans at banks from INR 1.02 trillion in March 2024 to INR 1.54 trillion by October 2024. Despite offering lower interest rates and flexible repayment options compared to personal loans, the gold loan segment remains vulnerable to default risks due to weak monitoring of loan-to-value (LTV) ratios, inadequate risk assessments, and non-transparent gold auction processes, prompting the RBI to urge lenders to improve their practices and educate borrowers on financial management. Loan defaults not only result in collateral loss but also negatively impact borrowers' credit scores, making future loan access difficult, while lenders may be forced to auction pledged gold to recover dues, further exacerbating financial strain. While gold loans continue to serve as a vital financial solution, mitigating default risks through improved credit assessment, enhanced borrower education, and flexible repayment options will be crucial for sustainable market growth.

Impact of Escalating Geopolitical Tensions on India Gold Loan Market

Escalating geopolitical tensions could significantly impact the growth of India Gold Loan Market by driving gold price volatility, increasing default risks, and affecting lending dynamics. Uncertainty in global markets often pushes investors toward gold as a safe-haven asset, leading to price surges that attract more borrowers. However, sharp price fluctuations can trigger margin calls, straining borrowers’ repayment capacity and increasing non-performing assets (NPAs). Lenders, including NBFCs like Muthoot Finance, face higher risks due to weak loan-to-value monitoring. To sustain market stability, financial institutions must strengthen risk assessments, enhance borrower education, and introduce flexible repayment structures to mitigate defaults amid geopolitical uncertainties.

India Gold Loan Market

Segmental Coverage

India Gold Loan Market – By Type

Based on type, India Gold Loan Market is bifurcated into Organized Gold Loan and Unorganized Gold Loan segments. The unorganized gold loan segment holds a higher share in India Gold Loan Market by type. Traditional moneylenders, pawnbrokers, and local financiers account for a major share of the market by type, surpassing the organized segment led by banks and NBFCs. The unorganized sector's dominance is driven by minimal documentation, faster disbursals, and flexible repayment options, making it the preferred choice for rural and semi-urban borrowers. Despite the rapid growth of NBFCs and digital lending platforms, the unorganized gold loan segment is expected to maintain its lead due to deep-rooted traditional lending practices and accessibility in underserved regions. While regulatory efforts aim to expand the organized market, the trust and convenience offered by informal lenders will likely sustain their stronghold in India’s gold loan market. Meanwhile, the organized gold loan segment is expected to record the fastest growth rate during the forecast period. It is driven by increasing economic activity, greater gold monetization, and a rising preference for formal lending channels. NBFCs specializing in gold loans have solidified their market presence through strategic investments in branding, promotions, and geographic expansion, offering quicker loan processing, precise gold valuation, and secure asset management. While banks remain active in the segment, primarily to fulfill Priority Sector Lending (PSL) mandates, their rigid lending frameworks and slower processing times give NBFCs a competitive advantage. The emergence of Small Finance Banks (SFBs) and Nidhi companies is further fueling the expansion of the organized market by promoting financial inclusion, particularly in rural areas. Leveraging lower-cost funds through deposits, these institutions are well-positioned to challenge NBFCs and broaden the reach of formal gold lending. Industry estimates indicate that the organized gold loan sector’s share has surged from 10% in 2014 to 32% in 2024 and is expected to exceed INR 10 lakh crore in FY25, reaching INR 15 lakh crore by March 2027, driven by the growing demand for accessible and secure credit solutions. While the informal sector continues to play a role, the increasing dominance of organized lenders underscores a shift toward structured, transparent, and efficient gold loan financing in India.Bottom of Form

India Gold Loan Market – By Provider

India Gold Loan Market by provider is divided into Banks, NBFCs, Digital Lenders/Fintech Companies, and Informal Lenders segments. The banks segment holds the highest share in India Gold Loan Market by provider. Its dominance attributed to their competitive interest rates, stringent regulatory frameworks, and the established trust they command among customers. This position is further strengthened by their extensive branch networks and substantial deposit bases, allowing for the provision of favorable loan terms. While non-banking financial companies (NBFCs) are actively expanding their gold loan portfolios, their interest rates generally remain higher. Public sector banks, in particular, have solidified their market leadership by enhancing their gold loan offerings, especially within the agricultural and small business sectors. Moreover, the ongoing digital transformation is enabling banks to leverage technology for seamless gold loan services, thereby expanding their reach and reinforcing their leadership in the growing Indian gold loan market.

India Gold Loan Market – By End User

On the basis of end user, India Gold Loan Market is divided into Farmers & Agri-based Borrowers, Small Business Owners, Salaried Professionals, Housewives, and Students segments.

India Gold Loan Market – By Region

The in-depth research report on India Gold Loan Market covers the market in the country’s major regions: North India, South India, East India, and West India regions. South India holds the highest share in India Gold Loan Market and is expected to maintain its dominance during the forecast period. The stronghold is deeply rooted in the region’s cultural affinity for gold, where it is not only valued as a symbol of wealth and tradition but also serves as a key financial asset. The demand for gold loans in South India remains consistently high, driven by seasonal festivals, economic factors, and increasing financial inclusion. Kerala, in particular, has seen a surge in gold loan applications post-Onam, reinforcing the region’s reliance on gold-backed credit. Similarly, Tamil Nadu, Karnataka, and Andhra Pradesh exhibit strong demand, supported by the presence of leading banks and NBFCs specializing in gold loans. While South India dominates, other regions, particularly Western India (Maharashtra, Gujarat, and Madhya Pradesh), are emerging as growing markets, accounting for 9.64% of the total gold loan portfolio. However, their contribution remains significantly lower compared to the Southern states. The Northeastern region holds a minimal share of just 0.26%, while the Central, Eastern, and Northern regions maintain moderate shares ranging between 3.42% and 3.97%. Despite this regional diversification, South India is expected to maintain its leading position in the gold loan market during the forecast period. The expansion of gold-focused NBFCs and banks, coupled with high gold consumption and a preference for gold-backed financing, will continue to drive this dominance. Additionally, regulatory shifts and digital lending innovations are likely to strengthen the role of South Indian financial institutions in the organized gold loan sector.

Competitive Landscape

Major players operating in India Gold Loan Market include Muthoot Finance Gold Loan, Manappuram Finance, Union Bank, SBI Gold Loan, Kotak Mahindra Bank, ICICI Bank Gold Loan, HDFC Bank, Axis Bank, Central Bank of India, Federal Bank Gold Loan, Karnataka Bank, UCO Bank, Reliant Gold Loas, Indian Overseas Bank, Bajaj Finserv, and Bank of Baroda. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In February 2025 - Muthoot Finance received approval from the Reserve Bank of India (RBI) to open 115 new branches across the country, reinforcing its presence in the gold loan market.

• In October 2024 - Google Pay partnered with Muthoot Finance to offer gold-backed loans, enhancing access to credit, particularly in rural areas. Google Pay is also collaborating with Aditya Birla Finance for similar offerings.

Scope of the Report

By Type

• Organized Gold Loan

• Unorganized Gold Loan

By Provider

• Banks (Commercial & Cooperative)

• NBFCs (Muthoot Finance, Manappuram Finance)

• Digital Lenders/Fintech Companies

• Informal Lenders

By End User

• Farmers & Agri-based Borrowers

• Small Business Owners

• Salaried Professionals

• Housewives

• Student

By Region

• North India

• South India

• East India

• West India

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. India Gold Loan Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Rising Gold Prices
         2. Growth of the Organized Lending Sector
         3. Increasing Financial Inclusion
      2. Restraints
         1. Fluctuations in Gold Prices
         2. Risk of Loan Default
      3. Opportunities
         1. Leveraging Digital Technology
         2. Expanding into Underserved Rural Areas
      4. Challenges
         1. Regulatory Changes
         2. Competition from Other Lending Options
   3. Technological Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. India Gold Loan Market: Marketing Strategies
5. India Gold Loan Market: Pricing Analysis
6. India Gold Loan Market Overview
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Type
         1. Organized Gold Loan
            1. Banks (Public & Private)
            2. Non-Banking Financial Companies (NBFC)
            3. Fintech Companies
         2. Unorganized Gold Loan
            1. Moneylenders
            2. Pawnbrokers
      2. By Provider
         1. Banks (Commercial & Cooperative)
         2. NBFCs (Muthoot Finance, Manappuram Finance)
         3. Digital Lenders/Fintech Companies
         4. Informal Lenders
      3. By End User
         1. Farmers & Agri-based Borrowers
         2. Small Business Owners
         3. Salaried Professionals
         4. Housewives
         5. Students
      4. By Region
         1. North India
         2. South India
         3. East India
         4. West India
7. North India Gold Loan Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Type
      2. By Provider
      3. By End User
8. South India Gold Loan Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Type
      2. By Provider
      3. By End User
9. East India Gold Loan Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Type
      2. By Provider
      3. By End User
10. West India Gold Loan Market
    1. Market Size & Forecast, 2019–2031
       1. By Value (USD Billion)
    2. Market Share & Forecast
       1. By Type
       2. By Provider
       3. By End User
11. Competitive Landscape
    1. List of Key Players and Their Offerings
    2. India Gold Loan Company Market Share Analysis, 2024
    3. Competitive Benchmarking, By Operation Channel Parameters
    4. Key Strategic Development (Mergers, Acquisitions, Partnerships, etc.)
12. Impact of Escalating Geopolitical Tensions on India Gold Loan Market
13. Company Profiles (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, SWOT Analysis)
    1. Muthoot Finance Gold Loan
    2. Manappuram Finance
    3. Union Bank
    4. SBI Gold Loan
    5. Kotak Mahindra Bank
    6. ICICI Bank Gold Loan
    7. HDFC Bank
    8. Axis Bank
    9. Central Bank of India
    10. Federal Bank Gold Loan
    11. Karnataka Bank
    12. UCO Bank
    13. Reliant Gold Loan
    14. Indian Overseas Bank
    15. Bajaj Finserv
    16. Bank of Baroda
    17. Other Prominent Players
14. Key Strategic Recommendations
15. Research Methodology
    1. Qualitative Research
       1. Primary & Secondary Research
    2. Quantitative Research
    3. Market Breakdown & Data Triangulation
       1. Secondary Research
       2. Primary Research
    4. Breakdown of Primary Research Respondents, By Region
    5. Assumption & Limitation

*Financial information of non-listed companies will be provided as per availability

**The segmentation and the companies are subjected to modifications based on in-depth secondary for the final deliverable

List of Figures

Figure 1       India Gold Loan Market Segmentation

Figure 2       India Gold Loan Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2024

Figure 4       India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Figure 5       India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Figure 6       India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Figure 7       India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Figure 8       India Gold Loan Market Share, By Region, By Value (USD Billion) 2019–2031

Figure 9       North India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Figure 10     North India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Figure 11     North India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Figure 12     North India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Figure 13     South India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Figure 14     South India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Figure 15     South India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Figure 16     South India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Figure 17     East India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Figure 18     East India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Figure 19     East India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Figure 20     East India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Figure 21     West India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Figure 22     West India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Figure 23     West India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Figure 24     West India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

List of Tables      

Table 1        India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Table 2        India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Table 3        India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Table 4        India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Table 5        India Gold Loan Market Share, By Region, By Value (USD Billion) 2019–2031

Table 6        North India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Table 7        North India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Table 8        North India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Table 9        North India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Table 10      South India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Table 11      South India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Table 12      South India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Table 13      South India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Table 14      East India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Table 15      East India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Table 16      East India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Table 17      East India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Table 18      West India Gold Loan Market Size, By Value (USD Billion), 2019–2031

Table 19      West India Gold Loan Market Share, By Type, By Value (USD Billion) 2019–2031

Table 20      West India Gold Loan Market Share, By Provider, By Value (USD Billion) 2019–2031

Table 21      West India Gold Loan Market Share, By End User, By Value (USD Billion) 2019–2031

Table 22      Muthoot Finance Company Overview

Table 23      Muthoot Finance Financial Overview

Table 24      Manappuram Finance Company Overview

Table 25      Manappuram Finance Financial Overview

Table 26      Union Bank Company Overview

Table 27      Union Bank Financial Overview

Table 28      SBI Company Overview

Table 29      SBI Financial Overview

Table 30      Kotak Mahindra Bank Company Overview

Table 31      Kotak Mahindra Bank Financial Overview

Table 32      ICICI Bank Company Overview

Table 33      ICICI Bank Financial Overview

Table 34      HDFC Bank Company Overview

Table 35      HDFC Bank Financial Overview

Table 36      Axis Bank Company Overview

Table 37      Axis Bank Financial Overview

Table 38      Central Bank of India Company Overview

Table 39      Central Bank of India Financial Overview

Table 40      Federal Bank Company Overview

Table 41      Federal Bank Financial Overview

Table 42      Karnataka Bank Company Overview

Table 43      Karnataka Bank Financial Overview

Table 44      UCO Bank Company Overview

Table 45      UCO Bank Financial Overview

Table 46      Reliant Company Overview

Table 47      Reliant Financial Overview

Table 48      Indian Overseas Bank Company Overview

Table 49      Indian Overseas Bank Financial Overview

Table 50      Bajaj Finserv Company Overview

Table 51      Bajaj Finserv Financial Overview

Table 52      Bank of Baroda Company Overview

Table 53      Bank of Baroda Financial Overview