Gold loans in India have seen a significant expansion over the last three years, with the average loan amount almost doubling to nearly Rs 2 lakh, signaling a surge in borrower demand and a growing acceptance of gold-backed credit. According to a report by TransUnion CIBIL, the balances of gold loans have quadrupled since March 2022, with their share in India’s retail credit portfolio climbing from 5.9% to about 11% by December 2025, making it the second-largest retail credit product by balance share.
The growth in gold loans is attributed to increased borrower adoption, larger loan sizes, wider lender participation, and a shift in borrower profiles, with more individuals, including women and those with stronger credit histories, entering the segment. The report also noted that the expansion has been particularly robust among NBFCs, whose share in gold loan balances rose from 7% in March 2022 to 11% in December 2025. Public sector banks also strengthened their position, with their share increasing from 57% to 62% during the same period.
The average gold loan balance per account surged from Rs 1.1 lakh in March 2022 to Rs 1.9 lakh in December 2025. Origination volumes have more than doubled since Q1 2022, with the average ticket size escalating from Rs 90,000 in Q1 2022 to Rs 1.96 lakh in Q4 2025. Borrower profiles have evolved, with prime and above-prime borrowers accounting for a higher share, rising from 43% in 2022 to approximately 52% in 2025, while the proportion of new-to-credit customers decreased from 12% to 6%, indicating a more mature and diversified borrower base.
The report highlighted that women borrowers have played a significant role in the growth, representing 39% of gold loan originations in 2025, up from 36% in 2022. They have shown strong traction in both traditional southern markets and states like Uttar Pradesh, Rajasthan, Gujarat, Maharashtra, and Madhya Pradesh. Borrower leverage has also increased, with the average outstanding per borrower rising from Rs 1.9 lakh in December 2022 to Rs 3.1 lakh in December 2025.
Bhavesh Jain, MD, and CEO of TransUnion CIBIL, mentioned that while gold has always been financially and culturally significant in India, there is now a structural shift in how gold-backed borrowing is utilized. He emphasized that gold loans are becoming a mainstream, organized, and accessible form of secured credit, reflecting both lender confidence and growing consumer acceptance. However, the rapid growth has raised concerns about asset quality, with overall delinquency for loans originated in the six months ending June 2025 standing at 1.1%. Borrowers with exposure above Rs 2.5 lakh exhibited higher delinquency at 1.5%, more than double the rate among lower-exposure borrowers.
