Gold Loans Set for ₹30 Lakh Crore Milestone by FY28 Amid Rising Demand

The gold loan market in India is expected to cross ₹30 lakh crore by FY28, driven by strong demand from retail borrowers. ICRA estimates that NBFCs had retail gold loan assets under management of around ₹4 lakh crore as of March 2026, while banks' retail gold loan portfolio nearly doubled during FY26.

The growth is largely being driven by households seeking short-term liquidity for medical emergencies, education expenses, weddings, working capital for small businesses and other consumption needs. Unlike large corporate loans, retail gold loans are typically secured by household gold jewellery, making them accessible to borrowers who may have limited formal credit history or need funds quickly.

The market is becoming increasingly competitive, with new lenders entering the segment organically or through acquisitions, while established NBFCs are rapidly expanding their branch presence. As a result, the market share of NBFCs is expected to rise to 23% by FY28, even though banks will continue to account for the majority of organised gold loans.

Lenders will have to adapt to evolving regulations, including changes in loan-to-value (LTV) norms and assessment of repayment capacity for larger loans. ICRA believes that lenders will need robust risk management practices to balance growth with prudent lending standards, particularly if volatility in gold prices increases.