Gold loans have emerged as the largest segment within non-housing retail loans, expanding at a compound annual growth rate (CAGR) of 42.4 per cent since March 2024, nearly double the 23 per cent growth in overall non-housing retail loans, according to the Reserve Bank of India’s Financial Stability Report (FSR) released on Monday.

The central bank said both banks and non-banking financial companies (NBFCs) accelerated gold loan disbursements during 2025-26, supported by rising gold prices.

Gold Rate

June 30,2026 - Time 10.30Hrs

Gold 24 KT ₹ 1 40,500 /-

Gold 22 KT ₹ 1,30,400 /-

Silver/Kg ₹ 2,21,100/-

Platinum ₹ 88,000/-

Recommended rate for Nagpur sarafa Making charges minimum 13% and above

Despite rapid growth in portfolios, loan-to-value (LTV) ratios have declined, reflecting an improvement in collateral buffers.

The RBI also said the rise in gold prices has enabled borrowers to avail larger loans against the same quantity of pledged gold. The report noted that the decline in LTV ratios despite strong portfolio growth has strengthened lenders’ protection against adverse movements in gold prices.

It observed that gold loan growth outpaced other retail loan segments across both banks and NBFCs. Primarily existing borrowers, who have used higher gold prices to secure larger loans and roll over existing debt, have driven the recent increase in gold lending.

The trend has been more pronounced among NBFCs. The report, however, cautioned that the rapid expansion in lending against gold collateral warrants close monitoring. A sustained correction in gold prices could reduce collateral cover, increase borrower stress and lead to higher delinquencies, it added.

The RBI’s stress tests highlighted concentration risks in NBFCs, indicating that defaults by a handful of large borrowers could weaken the capital positions of lenders.

Defaults by the top three individual borrowers would reduce its capital-to-risk-weighted assets ratio by 230 basis points, while that by the top three borrower groups would lower it by 240 basis points.

Under these stress scenarios, eight NBFCs would fall below the regulatory minimum CRAR requirement of 15 per cent. The report also estimated that the sector’s gross non-performing assets (GNPAs) could rise sharply from 1.7 per cent to 10.6 per cent under extreme stress.

Despite the simulated deterioration in asset quality, the RBI said the aggregate capital position of the NBFC sector would remain above the minimum regulatory requirement, indicating that the sector as a whole remains resilient even under severe stress scenarios.