Why Is India’s Gold Loan Market Expected to Reach ₹15 Lakh Crore by FY26?
ICRA’s Forecast on Gold Loan Industry Growth
India’s gold loan market is projected to expand significantly, touching around ₹15 lakh crore by FY26, according to the latest report by credit rating agency ICRA. The growth momentum is expected to be led by non-banking financial companies (NBFCs), whose assets under management (AUM) are likely to rise by 30–35% over the next 12–18 months.
This surge is being driven by steady gold prices, increased rural demand, and the preference for short-tenure secured loans. The sector’s resilience and high liquidity position have made gold loans an attractive credit segment for both borrowers and lenders.
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Beneficiaries: Muthoot Finance and Manappuram Finance
Among listed players, Muthoot Finance stands out as one of the biggest beneficiaries of the gold loan boom. With its extensive branch network and strong brand recognition in South India, the company continues to dominate the segment. The rising gold prices and digital disbursement channels have helped Muthoot maintain operational efficiency and asset quality. The company’s consistent performance and prudent risk management make it a key driver of sectoral growth.
Manappuram Finance, another leading NBFC in the gold loan segment, is also positioned to gain from the market’s expansion. Its focus on diversifying into microfinance, vehicle loans, and gold-backed small business credit offers a balanced risk-return approach. With improving rural credit demand and favorable regulatory outlook, Manappuram could witness strong AUM growth alongside higher profitability.
According to Gulshan Khera, CFP® — Main Strategist and Bank Nifty Expert at Indian-Share-Tips.com — this projected growth in the gold loan sector is not merely cyclical but structural. Khera observes that financial inclusion, gold monetization trends, and technology-led credit delivery models will continue to shape the next phase of NBFC-led lending in India.
💡 Insight: As households leverage gold as a liquidity buffer, NBFCs offering transparent and technology-driven loan models are likely to outperform peers with slower digital adoption.
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📈 Market Outlook: With credit growth accelerating and regulatory support for secured lending intact, the gold loan segment could emerge as one of the fastest-growing retail credit categories in FY26.
Investor Takeaway
The gold loan industry’s projected growth to ₹15 lakh crore underscores India’s deep-rooted trust in gold as collateral. Beneficiaries such as Muthoot and Manappuram are well placed to capture this surge, backed by robust distribution and digital innovation. As credit penetration expands, gold-backed lending remains a key lever for NBFC growth and stability in FY26.
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
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