•Gold loans have surged by 128% in the last year, reaching over 4 lakh crore rupees for the first time by January 31, 2026.
•The rapid growth is attributed to a 152% increase in gold prices over two years, allowing people to borrow more against higher-value jewelry.
•RBI's new rule mandating all gold-backed loans be categorized as gold loans has also contributed to clearer reporting and segment growth.
•Gold loans are a significant part of personal loans (9% contribution), favored by small traders, farmers, and households due to quick disbursement and lower interest rates.
•This trend highlights increasing reliance on secured credit, especially in rural areas where gold provides an accessible financing option despite low credit scores.
