Gold loans emerge as India’s second-largest retail credit segment by balance share, growing 3.8 times since March 2022, according to a report by TransUnion CIBIL. The share of gold loans in the overall retail credit portfolio has nearly doubled from 5.9% in March 2022 to 11.1% by December 2025, highlighting a structural shift in borrowing patterns across the country.
Key Highlights
- Gold loans grow 3.8x since 2022, becoming India’s second-largest retail credit segment by balance share.
- Rising ticket sizes, women borrowers, and lender participation drive strong growth in gold loan segment.
The rapid expansion reflects rising borrower adoption, higher ticket sizes, broader lender participation, and evolving borrower profiles. Gold loans, traditionally seen as a short-term liquidity option, are increasingly becoming a mainstream and organised form of secured credit, supported by strong lender confidence and growing consumer acceptance.
Women Borrowers Led the Segment
Women borrowers have emerged as a key growth driver in this segment. Their share in gold loan originations rose to 39% in 2025 from 36% in 2022, with strong demand not only in southern markets but also across states such as Telangana, Uttar Pradesh, Rajasthan, Gujarat, Maharashtra, and Madhya Pradesh. This indicates a broadening geographic reach and increasing financial participation among women borrowers.
The report also highlights strong momentum among lenders, particularly NBFCs and public sector banks. NBFCs increased their share of gold loan balances from 7% in March 2022 to 11% in December 2025, while public sector banks expanded their share from 57% to 62%, underlining growing institutional participation in the segment.
Rising Ticket Sizes and Changing Borrower Profiles
Borrowing patterns are also shifting significantly, with rising ticket sizes and higher borrower leverage. The average gold loan balance per account increased from Rs 1.1 lakh in March 2022 to Rs 1.9 lakh by December 2025, while the average ticket size more than doubled from Rs 90,000 in Q1 2022 to Rs 1.96 lakh in Q4 2025. Additionally, gold loan origination volumes grew 2.3 times, and origination value surged 5.1 times over the same period, indicating both scale and depth of growth.
There is also a noticeable shift in borrower profiles, with a stronger presence of creditworthy customers. The share of prime and above-prime borrowers increased from 43% in 2022 to around 52% in 2025, while new-to-credit participation declined from 12% to 6%, suggesting that gold loans are increasingly being used by more financially established borrowers.
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At the same time, borrower leverage has increased, with the average outstanding per borrower rising from Rs 1.9 lakh in December 2022 to Rs 3.1 lakh in December 2025. The proportion of borrowers with gold loan exposure above Rs 2.5 lakh also increased to 14% in 2025 from 10% in 2022, pointing to a growing reliance on gold-backed financing as part of broader credit portfolios.
Experts note that this trend reflects a deeper transformation in India’s credit ecosystem. As highlighted in the report, gold loans are no longer limited to emergency funding but are increasingly integrated into household borrowing strategies, alongside other forms of credit.
However, the report also flags the need for stronger risk assessment as the segment expands, particularly given rising borrower exposure and multiple loan accounts. As gold loans continue to gain prominence, lenders will need to balance rapid growth with prudent credit evaluation to ensure long-term stability in the retail lending market.
