The Reserve Bank of India (RBI) has amended its Lending Against Gold and Silver Collateral Directions, 2025, offering relief and clarity for banks, particularly cooperative banks, engaged in financing gold-linked businesses.

In its 1st Amendment Directions, 2025, the RBI has reiterated that no lender may extend loans for the purchase of gold in any form, including ornaments, jewellery, coins, or financial products backed by gold such as Exchange Traded Funds (ETFs) or mutual fund units.

Similarly, lending against primary gold or silver for speculative or investment purposes remains prohibited.

However, the central bank has carved out a significant exception benefiting Tier 3 and Tier 4 Urban Cooperative Banks (UCBs). Such UCBs, along with scheduled commercial banks, will now be allowed

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