Gold Loan Borrowers Alert: Budget 2026 May Bring Big Announcements

• Finance Minister Nirmala Sitharaman will present the Union Budget on February 1, 2026, with potential major announcements for gold loans.
• The gold loan industry seeks Priority Sector Lending (PSL) status for NBFCs, similar to banks, to lower funding costs and interest rates for borrowers.
• Most gold loan customers are middle or lower-income, using funds for medical, education, agriculture, or small businesses, often for amounts under ₹50,000.
• A 'gold credit line' via UPI is anticipated, allowing instant fund access and potentially reducing reliance on high-interest moneylenders in remote areas.
• Industry demands include increasing NBFC exposure limits to 20% of Tier-1 capital, citing gold loans' secured nature and low default risk, to boost liquidity and accessibility.

Why It Matters: Budget 2026 could make gold loans cheaper and more accessible through NBFC reforms and new UPI-based credit lines.