A Friend in Need

Gold loan companies may benefit from the tightening credit cycle, higher-than-ever gold prices after the latest geo-political episode in the Middle East and commercial lenders turning cautious in giving unsecured loans

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Once again, households that are in need of cash are finding that the gold loan companies are worth their weight in gold. A peek into the economic history unequivocally reveals that lenders who provide credit against the yellow metal have always provided money to households on time and without too many hassles whenever the credit gets dearer or dries up from other sources. The recent uptick in the volume of gold loans being availed by the households once again underscores this point.

To put it in perspective, credit markets are in a fluid state after major central banks made it clear that the `higher-for-longer’ rate corridor will remain open for an extended period as they believe the inflation fight is a glass half full and there are miles to go before the current rate hiking cycle reverses its course.