The report shows that gold loan balances expanded 3.8 times between March 2022 and December 2025, increasing their share in the overall retail credit portfolio from 5.9% to 11.1%. This rise reflects a structural shift in how borrowers use gold-backed financing, with the product increasingly becoming a mainstream and accessible form of secured credit.
Growth has been particularly strong among lenders. Non-banking financial companies (NBFCs) increased their share of gold loan balances from 7% to 11% during the period, while public sector banks expanded their dominance from 57% to 62%. At the same time, the average balance per gold loan account rose from ₹1.1 lakh to ₹1.9 lakh, indicating a significant increase in borrowing scale.
Origination trends further highlight the segment’s expansion. Gold loan origination volumes grew 2.3 times since the first quarter of 2022, while origination value surged 5.1 times. The average ticket size more than doubled from ₹90,000 to ₹1.96 lakh, suggesting that borrowers are increasingly using gold loans for higher-value credit needs.
Borrower profiles are also evolving. The share of prime and above-prime borrowers in gold loan originations rose to around 52% in 2025, up from 43% in 2022, while the share of new-to-credit borrowers declined to 6% from 12%. This indicates a shift toward more credit-active consumers integrating gold loans into their broader borrowing mix.
Women borrowers are playing a growing role in this expansion. Their share in gold loan originations increased to 39% in 2025 from 36% in 2022, with demand rising not only in southern markets but also across states such as Telangana, Uttar Pradesh, Rajasthan, Gujarat, Maharashtra, and Madhya Pradesh.
The report also points to rising borrower leverage. The average outstanding per borrower increased from ₹1.9 lakh in December 2022 to ₹3.1 lakh in December 2025. Meanwhile, the proportion of borrowers with exposure above ₹2.5 lakh rose to 14% from 10%, indicating deeper credit penetration and higher dependence on gold-backed borrowing.
Despite the strong growth, the report flags emerging risks. For loans originated in the six months ended June 2025, overall delinquency stood at 1.1%. However, borrowers with outstanding amounts above ₹2.5 lakh showed higher stress, with delinquency at 1.5%, more than double that of those with lower exposure.
The study also finds that borrowers with a history of serious delinquency face a higher risk of dropping out of the formal credit system if they increasingly rely on gold loans, with credit-access closure rates about 1.6 times higher than non-defaulting borrowers.
Bhavesh Jain, MD and CEO of TransUnion CIBIL, said the segment’s rapid growth reflects both lender confidence and rising consumer acceptance, but stressed the need for stronger risk discipline. He added that lenders must go beyond collateral value and assess borrower indebtedness, repayment capacity, and credit behaviour to ensure sustainable growth in the segment.
