RBI’s New Gold Loan Rules: Stricter Access Ahead

The Reserve Bank of India (RBI) has proposed tougher regulations on gold loans to be implemented from January 1, 2026. These new draft guidelines will limit how gold loans are issued and managed to reduce risk and ensure greater transparency.

• For bullet repayment loans, the accrued interest will now count within the 75% Loan-to-Value (LTV) cap from the beginning, resulting in lower disbursed loan amounts.
• Only gold jewelry and bank-issued 22-carat (or higher) gold coins will be accepted as collateral. Gold bars and bullion will be excluded.
• Valuation must be done by trained assayers in the borrower’s presence using either the 30-day average price or the previous day's market rate.
• Ownership proof of pledged gold will be mandatory.
• Collateral limits per borrower are set at: 1 kg for gold ornaments, 50 grams for gold coins, and 500 grams for silver coins.
• No re-pledging is allowed until the prior loan is fully repaid.
• Penalties will apply to lenders if there's a delay in returning collateral after repayment.

States like Tamil Nadu and the Finance Ministry have raised concerns that the rules may restrict credit access for small borrowers. They have recommended exempting loans below ₹2 lakh and delaying the implementation deadline to avoid hardship for low-income individuals.