1.RBI Drafts Gold-Loan Guidelines (Gold Loan Norms)
What & Where
RBI draft guidelines to standardise gold-loan practices across Indian banks & NBFCs
Covers collateral eligibility, valuation, LTV, tenure, renewal, repossession
Seeks borrower protection amid rising gold-loan NPAs and rapid portfolio growth
Quick Facts for MCQs
Legal & Policy
- Harmonisation codifies disparate bank & NBFC practices
- Ownership declaration or original bill compulsory, uncertain titles ineligible
- Concurrent loans on same collateral expressly prohibited
Economic Angle
- Tighter norms may curtail NBFC liquidity, slow >100 % YoY portfolio growth
- Mandatory assay, monitoring increases compliance cost, especially for small lenders
- Inclusion of interest in bullet loans lowers disbursable quantum, impacting margins
Consumer Protection
- LTV cap plus valuation safeguards curb over-leveraging, asset loss
- Seven-day return clause with hefty penalty guarantees swift release of pledged gold
- Separate scrutiny for business loans emphasises cash-flow viability over collateral value
Key Data Points
| Feature | Data-Point |
|---|---|
| Permitted collateral | Only jewellery, bank-issued coins |
| Barred collateral | Bars, ingots, bullion |
| Loan-to-Value ceiling | 75 % of assessed gold value |
| Bullet loan rule | Interest counted inside LTV |
| Valuation price | Lower of 30-day average or previous day 22-carat rate |
| Max gold per borrower | 1 kg jewellery or 50 g coins |
| Consumption loan tenure | ≤ 12 months |
| Fresh loan condition | Allowed only after full repayment |
| Gold return deadline | Within 7 working days post-closure |
| Delay penalty | ₹5,000 per day |
| FY24 NPAs – banks | ₹2,040 crore |
| FY24 NPAs – NBFCs | ₹4,784 crore |








