Gold Loans Race Ahead As Banks Shift To Secured Credit

Gold loans became the fastest-growing bank loan category in January 2026, lifted by high gold prices, bigger ticket sizes and a visible shift towards secured borrowing.

India’s banking system saw a sharp spike in gold-backed lending in January 2026, with loans against gold jewellery rising 128% YoY, ahead of every major loan category tracked in recent banking coverage. 

At the same time, overall non-food credit grew 14%, retail loans 15%, and corporate credit 12%, showing that credit was expanding across segments but gold loans were moving much faster. Reports published on 27 and 28 February 2026 linked this rise to surging gold prices, stronger collateral values and lenders leaning more heavily on secured retail credit.

Why Gold Loans Took The Lead In January

The January numbers were unusually strong even by recent standards. The Economic Times reported on 28 February 2026 that gold loans grew 128% YoY, while renewable energy lending rose 62%, making it the next fastest segment. In the same set of reports, export credit fell 17.2%, while industrial pockets such as gems and jewellery and engineering each posted 36% growth. This left gold loans well ahead of the field.
 

The shift is also visible in retail credit mix. Business Standard reported on 28 February 2026 that gold loans’ share in banks’ retail book doubled to 6% in January 2026 from 3% in January 2025. Another Economic Times report said gold-loan outstanding had reached about ₹3.83 lakh crore by January, up 128% YoY and 86% in the financial year. This shows the rise was not only about fresh demand, but also about scale within bank balance sheets.

Read More : How Gold Loans Help Small Businesses in India?

What Happened Before This Surge

The January burst came after months of fast expansion. LoansJagat reported on 2 February 2026, citing CRIF High Mark CreditScape: Gold Loans in India, January 2026, that the country’s gold-loan portfolio outstanding reached ₹15.6 lakh crore in November 2025, up from ₹7.9 lakh crore in November 2023. It also said the portfolio rose 41.9% YoY, while active accounts increased only 10.3% YoY to 9,02,60,000, suggesting that average loan sizes rose faster than borrower count.

That pattern is echoed elsewhere. Upstox, in a report published on 28 January 2026, also said the gold-loan portfolio had nearly doubled to ₹15.6 lakh crore in 2 years, adding that public sector lenders held 60% market share. 

LoansJagat separately reported on 30 January 2026 that nationalised banks accounted for nearly 60% of India’s gold-loan portfolio outstanding. Economic Times then reported on 9 January 2026 that bank gold loans had accelerated from ₹89,898 crore in November 2023 to ₹1.59 lakh crore by November 2024, before reaching about ₹3.5 lakh crore by end-November 2025.

Past data from lenders and market trackers shows the run-up had started well before January.
 

These figures show that higher gold prices and larger ticket sizes had already built strong momentum.

Also Read : India's Gold Loan Rules Have Changed

This month, the trend stayed firm. Business Standard reported on 5 March 2026 that gold-loan disbursements surged 94% in Q3 FY26, with private banks up 65.75% YoY to ₹1.21 trillion and public sector banks up 71.24% to ₹3.75 trillion. That indicates January was part of a broader secured-credit run, not a one-off spike.

Statements By Stakeholders

RBI Governor Sanjay Malhotra said on 7 February 2026 that the central bank was “very comfortable” with gold-loan exposure and saw no cause for concern, noting that loan-to-value ratios were below prescribed limits. 

Market reports by Economic Times and Business Standard also tied the jump to rising bullion prices and bigger collateral-backed borrowing.

Conclusion

Gold loans have turned into the fastest-moving bank credit segment, with January 2026 giving the clearest proof yet. The latest numbers point to one trend: banks are scaling secured retail lending quickly while gold prices keep the product attractive.