India's Gold Financing Boom: High Prices and Tight Credit Fuel Growth
India's gold financing industry is experiencing strong growth due to high prices and tight access to unsecured credit, according to an Antique Stock Broking report.
The report states that India's gold-financing market, valued at Rs 18.6 trillion, remains 'underpenetrated' with only ~9-10% of household gold being formally monetized.
With India accounting for around 26% of global gold demand, the underlying collateral pool is expanding, supporting higher loan ticket sizes and stronger AUM growth for gold financiers.
Elevated gold prices and tighter access to unsecured credit are emerging as key catalysts for growth in gold financing, with NBFCs specializing in gold financing expected to grow at a ~40% CAGR over FY25-27E to reach INR 4trn by FY27E.