Outstanding gold loans in India are projected to reach ₹18.30 lakh crore by fiscal year 2026 [1, 2].
This surge reflects a shift in how Indian households and businesses access liquidity. As unsecured credit conditions tighten and gold prices climb, more borrowers are turning to secured lending to fund their needs.
Provisional data indicates that gold loans have grown approximately 145 percent since fiscal year 2023, when outstanding loans stood at ₹7.46 lakh crore [1]. This expansion has significantly increased the role of gold-backed debt within the broader financial landscape. In fiscal year 2023, gold loans accounted for 18.2 percent of outstanding personal credit [1]. By fiscal year 2026, that share is expected to rise to 26.3 percent [1].
Financial institutions, including banks and non-banking financial companies (NBFCs), are seeing a change in borrower behavior. The average ticket size for these loans has reached ₹1.96 lakh in fiscal year 2026 [2]. This increase is driven by the rising market value of the collateral being pledged, primarily jewellery.
Industry analysts said the trend is not temporary. The gold loan market is projected to continue its upward trajectory, with some estimates suggesting it may cross ₹30 lakh crore by fiscal year 2028 [7].
Borrowers are increasingly utilizing gold as a strategic asset. The ability to unlock cash without the stringent requirements of unsecured personal loans makes gold pledging an attractive option for those facing tighter credit markets [3, 4].
“Outstanding gold loans are projected to reach ₹18.30 lakh crore by FY 2026”
The rapid growth of gold loans signals a transition in India's credit market where borrowers are favoring secured assets over unsecured loans to mitigate the impact of tighter lending standards. While this provides a safety net for borrowers and lower risk for lenders, the heavy reliance on gold prices means the stability of this credit surge is closely tied to the volatility of the global commodities market.
