New Delhi, March 31 (IANS). Gold loans have emerged as the largest segment in India’s retail credit market. According to a report released on Tuesday, its share in the total loan volume has reached 36 percent and in terms of value it has reached about 40 percent. The main reason behind this is the rising prices of gold and the increasing trend of people towards secured loans.
According to TransUnion CIBL report, the average amount of gold loan has increased significantly in the last two years. The average gold loan reached around Rs 1.9 lakh in the December 2025 quarter, which shows the growth in this segment.
The report also noted that the Consumer Market Indicator (CMI), which reflects credit market conditions, rose to 102 in the December 2025 quarter. It was 97 a year ago and 100 in the September quarter. That means it has seen improvement for the third consecutive quarter.
High gold prices have prompted people to take loans using the gold they possess, leading to a sharp increase in both the demand and distribution of gold loans.
Earlier the dominance of gold loan was more in South India, but now it is increasing rapidly in the North and Western states like Uttar Pradesh, Madhya Pradesh and Rajasthan also.
Now different types of customers are also joining this segment. According to the report, more than half of the loans are being taken by customers in the Prime and above category, indicating that gold loans are now becoming a mainstream credit option.
The report also said that there has been a slight softening in credit supply following the festivals and GST-related impact, but this is due to seasonal reasons and not a sign of any permanent decline.
Demand for credit remains strong, especially in semi-urban and rural areas. The share of non-metro areas in the total borrowers has increased to 54 percent, which is 3 percent more than last year. At the same time, the share of customers taking loans for the first time has also increased to 15 percent.
Meanwhile, the auto loan segment has also remained stable. Especially due to the demand for mid-segment vehicles, it is seeing balanced growth and the supply has also increased compared to last year.
–IANS
DBP
