Amid a muted overall credit growth in the banking sector, gold loans have emerged as the only segment witnessing strong traction. Rising gold prices have further boosted customer demand.

Small finance banks are actively ramping up efforts to seize the opportunity and scale up gold loan portfolios by adding branches and deploying more employees on ground. This also marks a shift from unsecured lending to secured loan books.

“We look forward to scale up the gold business. We would like to cater to customers in three segments – consumption purpose, business expansion and income generation – primarily focusing on business banking clients through overdraft and tailored offers. It will help unlock capital by shifting towards secured assets, thereby improving liquidity and capital efficiency,”

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