'Gold loan market is huge; space for all to grow'

Muthoot Finance doubled its annual gold loan growth guidance to 30-35% after a strong second quarter that saw gold loan AUM jump 45% year-on-year to a record ₹1.25 lakh crore. MD

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George Alexander Muthoot tells Narayanan V the reasons behind the strong demand for gold loans, ₹35,000-crore fundraising plans, and how competition is shaping the gold loan market. Excerpts:

What prompted a sharp revision in gold loan guidance?

Our gold loan AUM grew 38% last year. In the first half of FY26 alone, the gold loan portfolio expanded by 21%, or ₹3,657 crore. So, the earlier growth guidance of 15% looked redundant. Accordingly, we have upgraded the gold loan growth guidance for the fiscal to 30-35% from 15%. We see good demand for gold loans in both rural and urban markets going forward. Favourable regulatory changes by the RBI for the gold loan sector, higher gold prices, and tighter norms for unsecured credit are expected to support demand. Microfinance entities are still not disbursing loans, and banks are becoming conservative in unsecured personal loans. So, availability of money is an issue, and people are now looking at secured avenues to get loans.