Gold Loans Surge as Indians Opt for Borrowing Against Gold Holdings
India is witnessing a surge in gold loans as people increasingly borrow against their gold holdings to meet financial needs. The trend has accelerated in 2026, with data showing a 68.5% year-on-year increase in credit against jewellery by non-banking finance companies (NBFCs) in July.
The high rise in gold prices has played a significant role in increasing the demand for gold loans. With domestic gold prices up by 59% in Q2 2026 compared to the previous year, borrowers can now get a loan of a higher amount with the same quantity of gold.
Gold loans are attractive as they allow people to monetise their gold holdings without having to sell them. The collateralised nature of gold loans provides extra security for lenders and helps borrowers access credit using an asset they already own.