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Growth momentum strengthened, with sourcing value growth accelerating from 69% in FY25 to 84% in FY26. Higher gold prices and larger ticket sizes, which nearly doubled to Rs 1.96 lakh, are key drivers of expansion. Adoption is broad-based, with strong growth in states like Uttar Pradesh, West Bengal, Rajasthan and Maharashtra, alongside rising participation from banks, NBFCs and specialised lenders. Credit quality remains stable, with 75% repeat borrowers in Q4 FY26 and net 90+ day delinquency improving to 0.2% by March 2026. |
Gold loans are rapidly evolving into a mainstream credit product, enabling consumers to unlock the value of household gold while contributing to broader financial inclusion and credit growth, according to Experian’s latest report, Gold Loans in Transition: Market Evolution & Consumer Patterns.
The report highlights a structural shift in India’s retail credit landscape, with gold loans increasingly being adopted as a reliable and accessible financing option. Gold loan sourcing value accelerated from 69% growth in FY25 to 84% in FY26, reflecting stronger customer demand and deeper market penetration. The industry’s portfolio expanded from Rs 6.3 lakh crore in March 2023 to Rs 19.4 lakh crore by March 2026.
According to the report, growth in the gold loan segment is increasingly being driven by larger ticket sizes, stronger borrower demand, broader geographic adoption and growing participation across banks, NBFCs and specialised gold lenders. Gold loans are emerging as an important component of formal credit expansion and financial inclusion, moving beyond their traditional role as an emergency credit instrument.
The report identifies rising gold prices as a key factor behind this growth. While the gold price index increased by 144% during the study period, gold loan sanction amounts grew by more than 200%, allowing borrowers to unlock larger loan amounts against the same underlying asset. Average ticket sizes nearly doubled from Rs 0.98 lakh in FY23 to Rs 1.96 lakh in FY26, indicating a shift towards larger-value loans.
Broad-based growth
Growth is also becoming more broad-based geographically. While southern India remains a key market, states such as Uttar Pradesh, West Bengal, Rajasthan and Maharashtra recorded year-on-year sourcing growth of 138%, 112%, 105% and 102%, respectively, in FY26, indicating expanding acceptance of gold-backed lending beyond its traditional regional concentration.
Priority Sector Gold Loans (PSGL) accounted for around 23% of total gold loan sourcing value in FY26, supporting formal credit access across rural, semi-urban, agricultural and underserved communities. The report said PSGLs are helping convert dormant household gold into productive capital while supporting women-led households, micro-enterprises and livelihood generation.
The report also highlighted changing borrowing behaviour. The share of gold loan customers using multiple credit products increased from 10% in December 2021 to 17% in December 2025, while nearly 75% of sourced gold loan customers in the fourth quarter of FY26 were repeat borrowers, indicating that gold loans are increasingly becoming a recurring credit solution rather than a one-time borrowing instrument.
Despite rapid growth, portfolio quality remained resilient, with net 90-plus day delinquency improving from 0.4% in March 2023 to 0.2% in March 2026.
The report also noted shorter loan tenures and stronger repeat borrowing behaviour, indicating that gold loans are increasingly being used to meet immediate liquidity requirements and recurring funding needs. It added that as participation in the segment expands, the future of gold lending will depend on balancing growth opportunities with sustainable lending practices and responsible risk management.
