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Summary: The new RBI gold loan guidelines announced in April 2025 make gold loans safer and more transparent by capping the LTV ratio at 75%, enforcing strict approval checks, standardising gold valuation, and limiting pledges to 1 kg. Borrowers benefit from fairer terms and better protection, while lenders must ensure responsible lending and regular usage monitoring.
Gold loans have always been a trusted financial backup for Indians, helping them meet urgent fund requirements by unlocking the value of their gold ornaments.
With the growing demand for gold lending, the Reserve Bank of India (RBI) has issued new guidelines to restore order and increase security in this sector.
Announced on April 9, 2025, the latest RBI gold loan guidelines aim to make gold loans safer, more transparent, and consistent.
These regulations focus on ensuring that borrowers enjoy a fair, secure, and hassle-free experience while also preventing the irregularities and risks that surfaced in recent years.
What are the New RBI Gold Loan Guidelines?
Loan Approval & Repayment Capacity
Before approving a gold loan, lenders are required to check whether you are able to repay it. This means you cannot get a gold loan without providing proof of income or demonstrating your repayment capacity. This step is designed to protect both you and the lender, making sure you are not taking on more debt than you can handle.
Loan-to-Value (LTV) Ratio as per RBI Gold Loan Rules
According to RBI rules on gold loans, the LTV (Loan-to-Value) ratio for gold loans is still capped at 75%. However, lenders now have to ensure this limit is maintained throughout the loan period, not just at disbursal.Apply today with
For bullet repayment loans, where the principal is due for repayment at the loan's maturity, the LTV shall be calculated based on the total amount repayable at maturity rather than the original loan amount.
Loan Renewals and Top-Ups
For gold loan renewals or top-ups, the lender will only consider your application if your current loan is classified as standard and still within the allowed LTV ratio.
Moreover, you need to make a formal request, and the lender must carry out a fresh credit check before approving anything new.
Gold Valuation and Purity
As per the latest gold loan guidelines RBI, lenders must have a clear, standardised way to check the purity and weight of gold, including both gross and net weight.
The lender must also ensure you are present during the valuation. They must clearly explain any deductions for things like stones, fastenings, etc., and provide you with a certificate detailing the same. This process must be the same at every branch.
Purpose and Usage Monitoring
You cannot apply for gold loans for both personal and business purposes at the same time. Further, lenders are required to regularly monitor how you are using your gold loan. They will also keep evidence to show that the money is being used for the intended purpose.
Collateral Restrictions
Loans cannot be granted against primary gold, silver, or financial assets backed by them, such as gold ETFs or mutual fund units. According to the latest RBI rules on gold loans, only gold ornaments and specially minted coins (22 carats or higher, sold by banks) are accepted as collateral.
Further, you cannot pledge more than 1 kg of gold in total. Out of this, only up to 50 grams can be in the form of coins.
Bullet Repayment Loans
The maximum tenure of consumption loans with bullet repayment is now capped at 12 months.
No Repledged or Disputed Gold
As per the new RBI gold loan rules, lenders shall not extend loans against gold that has already been pledged elsewhere or if there is any doubt about its ownership.
What Is the Future of Gold Loans in India?
The future of gold loans in India looks bright and borrower-friendly. With gold prices staying high and people becoming more financially aware, gold loans will remain a go-to option for quick and reliable credit.
The new RBI gold loan guidelines are boosting transparency and trust, making borrowers more likely to choose formal lenders over informal ones. As banks and NBFCs compete, you can expect better deals, more flexibility, and a safer, more convenient borrowing experience.
Impact of New RBI Gold Loan Rules for the Users
- Borrowers will enjoy favourable loan terms and a fair, transparent process for gold valuation.
- With stringent checks and regular monitoring, your gold will stay safe and cannot be misused or undervalued.
- By linking loans to repayment capacity and restricting simultaneous loans, the risk of over-borrowing and debt traps is reduced.
- Some borrowers might find the new guidelines and lower LTV caps restrictive, especially if they are used to easier renewals.
- No matter which lender you choose, you can expect a similar, standardised process.
Conclusion
The recent RBI gold loan guidelines are a big move toward making gold-based lending safer and more consistent for everyone.
While these measures may slow growth for some informal lenders by introducing rigorous processes, they strengthen trust in the formal gold loan sector.
Ultimately, these RBI gold loan rules are poised to keep gold loans a vital and convenient source of credit, supporting both financial inclusion and sector stability.
Ready to benefit from the new RBI gold loan guidelines? Apply today with Manappuram Finance Ltd. for a safe and transparent borrowing experience.