Gold Loan Originations Surge 108 Per Cent YoY, Driven By Rising Ticket Sizes And Higher Borrower Leverage: Report

Gold loans have seen sharp growth, with originations rising 108 per cent year-on-year (YoY), driven by higher ticket sizes and increased borrowing by existing customers, according to the Gold Loan Landscape Report (April 2026) by TransUnion CIBIL.

The report has pointed out that gold loans have grown by almost 3.8 times since March 2022 and are now amongst the fastest-growing sections of retail credit. In their total retail credit portfolio, they also have grown their share to 11.1 per cent in December 2025 compared to 5.9 per cent in March 2022, second only to housing loans.

Transition towards Higher Ticket Size

Another factor that contributes to growth is ticket size. The ATS has gone up more than 200 per cent from about Rs 90,000 at the start of 2022 to approximately Rs 1.96 lakh in 2025. On the other hand, the Average Outstanding Amount (AOA) has grown by Rs 1.9 lakh to reach Rs 3.1 lakh.

In addition, the number of higher-ticket gold loans has gone up. Around 20 per cent of all gold loans taken in 2025 have tickets worth more than Rs 2.5 lakh, while just 13 per cent had this level of ticket size in 2022. This was due to higher gold prices and a change in borrowing behaviour from customers.

Repeat Borrowing And Multiple Loans Increase

There has been an evident increase in repeat borrowing. An increasing number of borrowers have taken multiple gold loans at one go. There is an increase in the average number of gold loan accounts per borrower, which suggests that borrowers have moved towards borrowing gold loans at frequent intervals.

New originations by borrowers, who already have existing credit exposure, have also augmented borrowers. In 2025, approximately 74 per cent of gold loans were taken by borrowers who already had more than Rs 1 lakh outstanding debts at the time of applying for the new loans.

Meanwhile, the proportion of borrowers having unsecured loans in their credit mix has risen. Around 23 per cent of borrowers had more than 25 per cent unsecured loans in their total debt burden in 2025.

Credit Profiles Improved

There has been some improvement in borrower credit quality. The proportion of prime and above-prime borrowers has gone up to around 52 per cent in 2025, compared to 43 per cent in 2022. In the meantime, new-to-credit (NTC) borrowers have gone down from 12 per cent to 6 per cent during the same period.

Nevertheless, the report has identified new risks. Increased leverage, multiple loans, and concentration of gold loans in a credit profile of a borrower have been associated with higher risks of default.

Gold loan borrowers with an outstanding exceeding Rs 2.5 lakh have exhibited almost 2.2 per cent higher delinquency levels than those with lower exposure. Borrowers who borrowed a large amount of gold loans relative to their total debt or those who recently missed repayment have also been more prone to default.

Policy And Risk Implications

The report has identified the necessity to have stricter risk evaluation as the segment has expanded. It has emphasised the need to measure the total exposure of the borrower and not necessarily based on the value of pledged gold.

Recent regulatory changes by RBI have added tiered loan-to-value (LTV) limits. Loans up to Rs 2.5 lakh have been permitted to a maximum of 85 per cent LTV, with higher-value loans having stringent limits.

Although gold loans have entered the mainstream credit market, the increase in borrower leverage and the tendency to take multiple loans have necessitated closer attention to maintain sanity within the market.