Gold Loans Surge in 2025 — May 2026

Gold loan borrowing hit new highs in early 2026 as gold prices surged, while demand for car and two-wheeler loans cooled down after the festive season. Here is what this shift means for your borrowing decisions.

Here's what happened: Gold loan originations rose sharply in Q4 FY26 as record-high gold prices increased the collateral value available to borrowers.. Auto and two-wheeler loan demand moderated after a festive-season spike in Q3, reflecting a natural post-Diwali slowdown in big-ticket purchases.. Rising bullion prices mean borrowers can now unlock significantly more cash against the same quantity of gold jewellery than a year ago..

What you should do: Check your idle gold jewellery — even 10–15 grams can fetch ₹40,000–₹60,000 as a secured loan at 10–14% interest, far cheaper than a personal loan.. Compare gold loan lenders before you apply — NBFCs like Muthoot and Manappuram often process faster, but bank gold loans (SBI, HDFC) typically offer lower rates.. Avoid rolling over gold loans indefinitely — if you cannot repay within 12 months, switch to a lower-cost personal loan to protect your jewellery from auction..

RBI caps gold loan LTV at 75% of gold value. So for ₹1 lakh worth of gold, you get max ₹75,000 — always verify the lender's valuation method before signing.