Aditya Birla Capital has entered the gold loan business and plans to open around 1,000 dedicated branches across India over the next three years. The company’s shares rose 2.02 per cent to Rs 404.75 on the BSE on 20 August following the announcement.
Branch Expansion
The company plans to open 200-300 gold loan branches by March 2027 as part of the initial rollout. The expansion will focus on markets with high potential for gold-backed lending.
The gold loan business will be operated through Aditya Birla Capital’s NBFC arm. The company will offer loans through physical branches as well as digital channels, targeting customers in urban and semi-urban markets. The company will also look to serve existing customers within the Aditya Birla Capital ecosystem, along with new borrowers.
Gold Loan Market
Aditya Birla Capital’s entry comes as the gold loan market expands amid higher gold prices and growing demand for secured borrowing. The company will compete with established gold loan lenders such as Muthoot Finance and Manappuram Finance. Other financial services companies have also increased their presence in the segment, intensifying competition for borrowers and branch locations.
The gold loan business will add to Aditya Birla Capital’s existing secured lending portfolio. Gold loans are backed by pledged gold jewellery, allowing lenders to offer financing against an asset held by the borrower.
The company plans to scale its branch network gradually, with the initial 200-300 branches expected to provide the base for its three-year target of around 1,000 branches. The planned expansion will give Aditya Birla Capital a larger physical presence in the gold loan segment while its digital channels can support customer acquisition and servicing.
The company’s move into gold loans comes as diversified financial services groups increasingly look to expand their presence in secured retail lending. For Aditya Birla Capital, the new business provides another avenue to expand its lending portfolio and customer base.