Gold Loans – NBFC Gold Lending Maintains Strong Growth at Nearly 70% in June
Gold Loans – Gold-backed lending by non-banking financial companies (NBFCs) maintained its rapid pace of expansion in June, with outstanding loans against gold jewellery rising nearly 70 per cent from a year earlier, according to the latest data released by the Reserve Bank of India (RBI).
The value of NBFC loans backed by gold jewellery stood at Rs 3.41 lakh crore at the end of June 2026. This represented a 69.3 per cent year-on-year increase. The pace was only marginally lower than the 69.9 per cent growth recorded in May, showing that the sharp rise in gold-backed credit has continued for a second consecutive month.
Gold loans outpace broader retail credit
The growth in loans against gold jewellery was significantly higher than the overall expansion of retail lending by NBFCs. Retail credit increased 20.3 per cent year-on-year in June 2026, compared with 14.3 per cent growth during the same month a year earlier.
The RBI, in its sectoral deployment of credit data, said housing, vehicle finance and loans against gold jewellery were among the retail segments that recorded strong credit growth during the month.
Total outstanding retail loans of NBFCs rose to about Rs 25.62 lakh crore in June 2026, compared with Rs 21.29 lakh crore in June 2025.
Housing and vehicle finance also record growth
Housing loans remained the largest component of retail lending, increasing 11.4 per cent year-on-year to nearly Rs 8.44 lakh crore in June. Vehicle loans also expanded during the period, rising 15.2 per cent to approximately Rs 6.24 lakh crore.
Consumer durable loans recorded an even faster increase. The segment grew 46.8 per cent over the year to Rs 72,201 crore, according to the RBI data.
RBI strengthens rules for gold-backed lending
The strong expansion in gold loans comes against the backdrop of tighter regulatory oversight by the central bank. The RBI introduced the Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025 in June last year to establish a common regulatory framework for loans backed by gold and silver across regulated lenders, including NBFCs.
The move followed supervisory concerns raised by the RBI in September 2024. The central bank had pointed to weaknesses in several areas of gold-loan operations, including the involvement of third parties in sourcing and valuation, customer due diligence, monitoring of loan-to-value ratios and transparency in the auction of pledged jewellery following defaults.
The RBI had also advised regulated lenders to maintain closer oversight of their gold-loan portfolios as rapid growth was being observed at some institutions.
Credit growth varies across key sectors
While retail lending and agriculture-related credit recorded healthy expansion, other parts of the economy saw a slower pace of growth. Credit to industry increased 6.7 per cent year-on-year in June 2026, down from 10.3 per cent in June 2025.
According to the RBI, weaker growth in infrastructure lending, which forms a significant part of industrial credit, was a key reason for the moderation.
Services sector credit growth also slowed, reaching 17.6 per cent in June compared with 22.4 per cent a year earlier. Commercial real estate continued to show strong expansion, while credit growth for trade and transport businesses moderated.
Agriculture credit sees sharper improvement
Agriculture and allied activities emerged as one of the stronger-performing sectors during the month. Credit growth in the segment accelerated to 17.9 per cent in June 2026, compared with just 5.1 per cent in the corresponding month of the previous year.
The RBI clarified that its provisional sectoral credit figures are based on data from a sample of NBFCs classified within the Upper and Middle Layers, along with housing finance companies. Together, these institutions account for around 87 per cent of the total credit covered in the central bank’s reference dataset.