Budget 2026: Gold Loan Industry Eyes Big Announcements, PSL Benefits, and UPI Integration

• Interest in gold loans has surged, with banks now competing fiercely with NBFCs, benefiting customers with more options.
• Gold loan NBFCs seek Priority Sector Lending (PSL) status, arguing that most gold loans are for low-income individuals for essential needs.
• Granting PSL benefits would lower NBFCs' cost of funds, enabling them to offer cheaper gold loans, especially in rural areas.
• The industry hopes for a gold credit line facility via UPI, allowing immediate loans against pledged gold jewelry.
• NBFCs also demand relief in single-counterparty exposure limits to better utilize capital and boost the gold loan sector.

Why It Matters: The gold loan industry anticipates significant Budget 2026 announcements, focusing on PSL status and UPI integration.