Non-banking financial companies are witnessing a remarkable surge in gold-backed credit, with a 68.5 per cent year-on-year growth in July 2026, significantly outpacing the moderating growth seen in banks' gold loan portfolios.
Key Points
- NBFCs' gold loans surged by 68.5 per cent year-on-year in July 2026, significantly accelerating from the previous year.
- Banks' credit against gold jewellery saw moderated growth of 88.1 per cent, down from 136.4 per cent a year earlier.
- At the end of July, NBFCs' gold loan book reached nearly Rs 3.54 trillion, while banks' stood at Rs 5.52 trillion.
- Overall retail loans for NBFCs grew 21.4 per cent, driven by gold loans, housing loans, and consumer durables.
- Credit growth in the services sector and industry moderated, but agriculture and allied activities showed robust growth of 18 per cent.
Credit against gold jewellery by non-banking financial companies (NBFCs), including housing finance companies, grew 68.5 per cent year-on-year (Y-o-Y) in July 2026, accelerating sharply from 43.9 per cent a year earlier.
In contrast, growth in banks’ credit against gold jewellery moderated to 88.1 per cent from 136.4 per cent during the same period, according to Reserve Bank of India (RBI) data.
At the end of July, NBFCs’ gold loan book stood at nearly Rs 3.54 trillion, while that of banks stood at Rs 5.52 trillion.
Gold loans were the fastest-growing category within retail loans for NBFCs, reflecting increased demand for gold-backed credit.
Overall Credit Trends
Overall credit extended by NBFCs rose 14.9 per cent Y-o-Y to Rs 59.89 trillion in July 2026, compared with 10.6 per cent a year ago.
This was, however, lower than the 19.1 per cent Y-o-Y growth recorded by banks during the same period.
Retail loans, which account for a significant share of NBFC lending, grew 21.4 per cent in July, accelerating from 13.7 per cent in July 2025.
Within retail credit, housing loans grew 11.9 per cent Y-o-Y to Rs 8.55 trillion, compared with 4 per cent growth a year earlier.
Vehicle loan growth remained broadly steady at 15.1 per cent, while credit for consumer durables grew 51.5 per cent.
Sectoral Credit Performance
The acceleration in retail lending came even as credit growth to some other major sectors moderated.
Credit to industry grew 7.4 per cent in July, compared with 9.3 per cent a year earlier.
The moderation was primarily driven by subdued growth in infrastructure, a major constituent of the segment.
Credit to infrastructure grew 6.2 per cent to Rs 20.16 trillion in July against 8.1 per cent a year ago.
Within infrastructure, credit to the power sector grew 6.9 per cent, down from 12.3 per cent a year earlier.
Credit growth in the services sector also moderated to 15.2 per cent in July from 24.5 per cent a year ago.
While credit to commercial real estate recorded buoyant growth of 22.3 per cent, growth in credit to trade and transport operators decelerated to 14.7 per cent and 10.7 per cent, respectively.
In contrast, credit to agriculture and allied activities recorded robust growth of 18 per cent in July, sharply higher than 5.4 per cent a year ago.
Outstanding credit to the sector stood at Rs 80,271 crore.
The data also showed that overall retail credit growth has accelerated considerably over the past year, with outstanding retail loans rising to Rs 26.06 trillion in July from Rs 21.46 trillion a year earlier.
Within the segment, housing loans and loans against gold jewellery recorded accelerated growth, while vehicle loans maintained steady growth.
