Gold loans drove India’s secured lending growth in FY26, with sourcing value jumping sharply as borrowers preferred collateral-backed credit and NBFCs gained a bigger share in the expanding market.
Gold Loan Demand in India: In FY26, the credit market in India leaned more toward loans backed by collateral. Experian’s report said secured loans formed 68% of sourcing value in the year. It also said secured lending grew 35% year-on-year, which was faster than the 22% rise seen in unsecured lending. In simple words, more people and lenders moved toward safer loans like gold loans and home loans instead of loans without security.
The same report also said total retail credit sourcing grew 31% to Rs 75 lakh crore in FY26, while overall industry AUM rose 19% to Rs 137 lakh crore by March 2026.
Gold Loans in Q4FY26
Gold loans were the big star in the last quarter of FY26. Experian said gold loan sourcing value jumped more than 2x year-on-year to Rs 7.6 lakh crore in Q4FY26. That was a huge 115% rise. The gold loan pool also kept growing in size, with assets under management climbing 47% to Rs 11.9 lakh crore as of March 2026. The average gold loan ticket size also moved up to Rs 2.1 lakh in Q4FY26 from Rs 1.4 lakh a year earlier. That means borrowers were taking larger gold loans than before, not just tiny ones.
NBFCs gain ground
The report also pointed to a change in who is winning more business. Non-banking financial companies, or NBFCs, raised their share of gold loan sourcing value to 40% in Q4FY26 from 28% a year ago. At the same time, the share of public sector banks came down. Experian also said gold loan asset quality stayed strong, with net 90+ delinquency falling to 0.2% from 0.3% a year earlier. That means fewer borrowers were slipping badly behind on payments.
According to Dr Renisha Chainani, Head of Research at Augmont, gold loans became one of the biggest reasons behind credit growth in FY26. She said there are three main reasons for this strong rise. One big reason is the sharp increase in gold prices, which allowed people to borrow more money against their gold because the value of the jewellery also went up.
Another reason is that the RBI made rules stricter for unsecured loans, so many borrowers started moving toward safer loans backed by collateral like gold. She also said banks and NBFCs are helping bring more people into the organised gold loan market. Along with this, the RBI’s updated loan-to-value rules increased the limit to 85% for loans up to Rs 2.5 lakh, making gold loans easier to access for many customers.
“The long-term organised gold loan market is expected to reach Rs 18 lakh crore by FY27, driven by rising gold prices, expanding credit demand, and the RBI’s revised tiered LTV framework. Having said that, key risks are rising NPAs and regulatory tightening on valuation and auction norms could moderate growth velocity,” Chainani said.