Gold Loan Market Booms: IndiaGold Secures NBFC License, Sector Sees 41.9% Growth

• Fintech startup IndiaGold, operating under Flat White Capital, has achieved profitability and secured an NBFC license from the Reserve Bank, marking a significant milestone.
• The gold loan market is experiencing immense growth, with disbursements reaching approximately 6.05 lakh crore rupees in the last quarter, a 53% increase year-on-year.
• Gold loans grew by 35.8% in Q2 FY26, significantly outpacing the 18% growth in overall retail loans, indicating a strong preference for gold-backed financing.
• Consumer behavior is shifting, with a decreasing number of small-amount loans (below one lakh rupees) and a rising share of loans over five lakh rupees, used for larger projects and business expansion.
• Gold loans are becoming a popular choice for first-time borrowers (15% of new credit market entrants) due to minimal documentation and quick cash availability, expanding rapidly across metro, Tier-2, and Tier-3 cities.

Why It Matters: The gold loan sector is witnessing unprecedented growth, driven by new players like IndiaGold and shifting consumer preferences.