When money gets tight, many Indians are increasingly turning to something already sitting safely at home, i.e., gold jewellery. Whether it is for medical needs, business expenses, education or simply quick access to cash, borrowing against gold is becoming a popular choice.
The trend has picked up sharply over the past year. Gold loans emerged as the fastest-growing retail credit segment in FY26, helped by rising gold prices and growing demand for secured borrowing, according to ‘How India Lends – Credit Landscape in India’, a report released by CRIF High Mark.
The report found that gold loans saw the strongest growth among all retail lending products in the fourth quarter of FY26.
Outstanding gold loan portfolios rose 50.4% year-on-year to reach Rs 18.6 lakh crore. This made gold loans the fastest-growing category in India’s retail credit market.
Experts believe one big reason behind the surge is the steady rise in gold prices. Since the value of pledged gold has gone up, borrowers are able to get bigger loans for the same jewellery. For lenders too, gold-backed loans are seen as safer because they are secured by a physical asset.
The report also noted that asset quality in the gold loan segment improved, suggesting that borrowers are managing repayments better even as demand rises.
Unlike some other loans that may require lengthy paperwork or strict income checks, gold loans are often quicker to access.
For many households, gold acts as a financial safety net during emergencies. Instead of selling jewellery, people can pledge it temporarily and borrow money when needed.
The report suggests that this demand remained strong in FY26, supported by favourable market conditions and higher collateral values.
Another trend becoming visible is larger borrowing amounts. As gold prices rose, the average ticket size of gold loans also increased, pointing towards a growing preference for bigger-value loans.
The report said India’s overall retail lending portfolio grew to Rs 170.2 lakh crore as of March 2026, marking a 16.6% rise compared to a year ago.
Consumption loans also continued to expand steadily, growing 15.3% year-on-year to Rs 118.6 lakh crore. Products such as personal loans, consumer durable finance and gold loans supported this growth.
Home loans maintained stable momentum as well, with the outstanding portfolio reaching Rs 44.4 lakh crore, up 9.4% from a year earlier.
However, credit card balances remained relatively weak, showing flat annual growth and a decline on a quarterly basis.
The report also pointed to an interesting shift in borrowing behaviour. Growth in loan portfolios continued to outpace the rise in active loan accounts, suggesting that borrowers are increasingly taking higher-value loans.
This trend, often referred to as premiumisation, was visible across categories including gold loans, home loans and consumer durable financing.
For gold loans, this means borrowers are not only taking loans more frequently but are also borrowing larger amounts, helped by the increase in gold prices.
One positive sign for lenders is that loan quality improved even as lending expanded.
According to the report, delinquency levels, or delayed repayments, declined across several segments, including home loans, gold loans, personal loans and consumer durable loans.
This suggests that borrowers have largely managed repayments well, even as credit demand remained strong.
While retail lending remained strong overall, some categories saw slower momentum after the festive season.
Auto loans fell 11.6% quarter-on-quarter in Q4 FY26, while two-wheeler loans declined 22.1% compared with the previous quarter.
Still, the report noted that lending activity continues to spread beyond metro cities, especially in personal loans, consumer durable financing and two-wheeler loans, with stronger demand emerging from semi-urban and rural areas.
The findings suggest that India’s lending market is gradually shifting towards secured and collateral-backed borrowing, with gold loans now playing a much bigger role than before.