Gold Loan Industry in India: Current Landscape and Search Trends in 2024

January 10, 2024 Neha Bawa 0

Gold is a valuable asset that significantly impacts the market, influences the dynamics of trade and drives the jewellery industry. This blog will tell you about the latest search trends and the current gold loan market landscape so that you can create better and more accessible offerings for your customers.

Gold has always been a significant part of Indian culture and festivities, and it is nationally considered a good omen and highly auspicious. And currently, the gold loan market in India is seeing significant growth across the country.

Gold also functions as a hedge against economic instability and inflation. The number of gold loans disbursed by banks continues to grow, while online searches for gold loans have increased by 57.47% in 2024 compared to the previous year.

As a gold loan provider, access to timely data about what your customers search for while looking for a gold loan can help you connect with them and provide a more personalized experience.

Table of Contents

Gold Loan Industry Overview

Gold loans are financial loans that customers take by mortgaging their gold. Several banks regulated by the government have offered gold loans for a long time, but a growing number of NBFCs (non-banking finance companies) have also started issuing gold loans.

Both types of institutions act as financial intermediaries, but they have several fundamental differences that might not become immediately apparent. These are as follows:

Criteria	Banks/finance companies	NBFCs
Regulatory authorities	All banks are regulated by the Reserve Bank of India under the Banking Regulations Act, 1949.	NBFCs are also regulated by the RBI but don’t have a banking license.
Lendings and borrowings	All lending activities are funded by deposits and borrowings from customers.	NBFCs issue public debentures, borrow from banks and accept deposits from customers to raise funds.
Credit assessment	Owing to their stringent regulations, banks follow a strict, non-negotiable process for credit assessment.	NBFCs are a lot more lenient in judging creditworthiness and often lend to customers who don’t meet the criteria laid down by banks.
Interest rates	Banks have a larger and more stable base of fund deposits, which allows them to charge lower interest rates.	The cost of acquiring funds is much higher, hence the interest rates charged by NBFCs is higher than banks’ charges.

Gold Loan Market Stats: Size & Growth

The Gold loan market size in India is huge and ever-changing. Bank loans taken against gold jewellery grew significantly, coming up to 16.2% YoY in January 2023. This is often attributed to the competitive interest rates offered by banks on gold loans, which often undercut the offerings by NBFCs.

The Indian gold loan market was valued at USD 55.52 billion in 2022 and, according to ICRA, is projected to reach a valuation of US $124.45 billion. This puts its compounded annual growth rate at about 12.22% per annum.

According to our Gold Loan Search Trends Report, insights on search volumes for different types of credit products show that search terms related to the gold industry have grown by over 57% from 2022-23 to 2023-24

Overall Search Volumes of India’s Lending Industry

Loan type	Search volume FY’22-’23	Search volume FY’23-’24	Growth %	Market share
Home loan	138.29 L	155.40L	12.37	36.48%
Personal loan	75.89 L	98.93L	30.36	23.23%
Auto loan	55.72 L	62.85L	12.80	14.76%
EMI card	25.44 L	44.03L	73.07	10.34%
Business loan	13.26 L	19.69L	48.47	4.62%
Loan against property	14.93 L	17.80L	19.23	4.18%
Gold loan	10.66 L	16.79L	57.47	3.94%
Education loan	6.55 L	7.02L	7.28	1.65%
Loan against securities	2.52 L	2.34L	-7.10	0.55%
Professional loan	1.03 L	1.09L	5.93	0.26%
Total	344.29L	425.95L	23.72	100%

Gold Loan Industry Trends in India (2024)

Experts have identified several trends in the gold loan market in India. These are as follows:

Banks will dominate: Government-regulated banks will continue dominating the market as the majority of agriculture loans they issue are secured by gold.
The growth of NBFCs: NBFCs are predicted to grow their gold loan portfolios in FY 2025 by about 17% to 19%.
Moderating returns: Gold loan yields from NBFCs have seen significant growth, but are expected to remain below the peak growth observed about five years ago.
Market share: Public sector banks are seeing an increase in their gold loan market share. Meanwhile, NBFCs continue to maintain their share in the product segment.

Drivers of growth in the market:

The rising prices of gold have resulted in people seeking to monetise their gold. Consequently, the demand for gold loans has also increased.
With financial services expanding to credit offerings and going digital, the gold loan market has seen significant growth.
The growing consumer demand for gold-related assets like jewelry has increased the demand for gold loans.
Both individuals and small and medium businesses have shown a growing interest in loans against gold assets.

Gold Loan Search Trends in India (2024)

Category	Search volume FY’22	Search Volume FY’23	% Growth
Gold loan	10.66L	16.79L	57.47%

There’s been a significant surge in the searches for gold loans, with a year-on-year growth of 57.47%. For FY’24, the search volumes for gold loans witnessed an increase of 57.47% with 16.79 lakh searches, as against the 10.66 lakh searches in FY’23.

A Rise in Brand Awareness

Search Volume by Query Type

Type of query	Search volume FY’22	Search volume FY’23	Growth %	Market share
Brand	6.30L	10.77L	7.94%	64.13%
Non-brand	4.36L	6.02L	38.03%	35.87%
Total	10.66L	16.79L	57.47%	100.00%

According to the Techmagnate Gold Loan Search Trends Report , branded and non-branded keyword searches experienced an encouraging rise with 8.46% and 16.56% search volumes, respectively.

Besides the increase in search volume, both keyword types captured a sizeable market share, with branded keywords at 59.07% and non-branded keywords at 40.93%.

Major Indian banks and NBFCs have also experienced a significant rise in search volumes and market share capture. Bank of Baroda, HDFC Bank, and Union Bank of India have demonstrated greater than 30% yearly growth in brand search volumes.

The Gold Loan Search Trends Report reveals the top 5 brands for gold loans, based on their search volumes. These are:

Brand	Search Volume (FY’23)	Market Share (FY’23)
IIFL Finance	175.05 K	43.52%
Muthoot Finance	90.07 K	15.12%
State Bank of India	56.05 K	7.12%
Bank of Baroda	54.06 K	5.96%
Indian Overseas Bank	41.07 K	4.68%

Despite the prevalence of mobile devices and the presence of mobile apps for gold loan providers, search volume and market share remained steady. This indicates that app usage for gold loans is growing but at a slow pace.

Brand	Search Volume (FY’23)	Market Share (FY’23)
Manappuram Finance (OGL)	3.30 K	71.39%
Rupeek	0.22 K	3.07%
Gold Cash Ltd.	0.18 K	3.78%
IIFL Finance	0.12 K	3.55%
Muthoot Finance	0.11 K	4.26%

Top 10 Keywords for Gold Rates

Keywords	Search volume FY’22	Search volume FY’23	% growth
Gold rate today	50.00L	61.20L	22.40
Gold price today	33.50L	33.50L	0
Gold rate	8.23L	8.23L	0
Gold price	10.00L	8.23L	-17.70
Today gold rate in delhi	3.68L	3.68L	0
Today gold rate in chennai	5.50L	3.68L	-33.09
Gold price today chennai	5.50L	3.68L	-33.09
Current gold rate in chennai	5.50L	3.68L	-33.09
Gold rate today hyderabad	3.01L	3.01L	0
Gold rate today bangalore	3.01L	3.01L	0
others	87.57L	90.35L	3.18
Total	215.50L	222.25L	3.14%

Our Gold Search Trends Report identified the top 10 keywords that were used to search for gold loans. These keywords will prove valuable for goal loan providers in understanding user behaviour, thus enabling them to revisit their SEO and digital marketing strategies.

‘Gold loan interest rate’ and ‘gold loan’ have topped the table with 90.50 K and 49.50 K searches respectively, with the former showing a growth of 22.22% in searches

Metropolitans Ruled the Gold Loan Market in India

Top 6 cities by search volume:

Cities	Search Volume FY 2022-23	Search Volume FY 2023-24	% Growth	Market Share
Bengaluru	85.17 K	106.16 K	24.64%	25.09%
Chennai	68.12 K	81.48 K	19.61%	19.26%
Hyderabad	66.31 K	78.39 K	18.22%	18.53%
Delhi	55.96 K	58.24 K	4.07%	13.77%
Mumbai	51.44 K	58.43 K	13.59%	13.81%
Pune	37.88 K	40.36 K	6.55%	9.54%
Total	364.88 K	423.06 K	15.94%	100.00%

A key insight from the data shows that users from metropolitan cities have conducted the most gold loan searches. South India had the highest number of searches with Bengaluru and Chennai topping the list with 106.16 K and 81.48 K searches respectively.
The search figure not only indicates the users’ affinity towards gold in South Indian cities but also an increasing demand for gold loans.

Strategies for Gold Loan Providers to Dominate the SERPS

Based on the data and the analysis provided by Techmagnate’s Gold Loan Search Trends Report, here are a few strategies that brands can integrate into their digital marketing strategy to conquer the goal loan market in India.

High-volume keyword optimization

In the competitive gold loan market, ranking for high-volume keywords is crucial. Keywords like “gold loan interest rate”, “gold loan calculator”, and “gold loan near me” are commonly searched by potential customers.

Top 10 Keywords

Keywords	Search Volume ‘22-23	Search Volume ‘23-24	% growth
Gold loan rate	60.50K	90.50K	49.59%
Gold loan interest rate	60.50K	90.50K	49.59%
Gold loan	40.50K	49.50K	22.22%
Gold loan calculator	18.10K	27.10K	49.72%
Gold loan near me	6.60K	12.10K	83.33%
Gold loan per gram	8.10K	9.90K	22.22%
Gold loan EMI calculator	4.40K	9.90K	125%
Gold loan amount per gram	8.10K	9.90K	22.22%
Gold loan interest	6.60K	8.10K	22.73%
Lowest gold loan rate	6.60K	6.60%	0%
Others	108.81K	141.69K	30.22%
Total	436.41K	602.39K	38.03%

Creating content optimised for these keywords can significantly improve search engine rankings. This includes using these keywords in titles, headers, meta descriptions, and throughout the content in a natural, reader-friendly manner.

Local SEO optimisation

With many users searching for gold loans in their vicinity, local SEO is a goldmine. This can be achieved by creating location-specific pages on your website and optimizing your Google My Business profile. This helps in appearing in local search results, making it easier for nearby customers to find your services.

Near-me searches

Category	Search Volume FY’22-23	Search volume FY’23-24	Growth %	Market share
Brand	21.90K	26.78K	22.28%	55.18%
Non-brand	13.54K	21.75K	60.64%	44.82%
Total	35.44K	48.53K	36.94%	100%

Content marketing

Developing a robust content marketing strategy is key. This involves creating informative blog posts, guides, and FAQs that address common queries related to gold loans.

This content should not only be rich in keywords but also provide real value to readers, establishing your brand as a knowledgeable and trustworthy source in the industry.

Mobile optimisation

With many internet users accessing information via smartphones, having a mobile-optimized website is essential. This includes ensuring fast loading times, easy navigation, and a responsive design that adapts to different screen sizes. It should also help to know that more people have started searching for apps designed specifically for gold loans and related services.

Search Volumes for Gold Loan App

Category	Search volume FY’22-23	Search volume FY’23-24	Growth %	Market Share
Brand	4.50K	4.23K	-6.00%	70.15%
Non-brand	0.82K	1.80K	119.51%	29.85%
Total	5.32K	6.03K	13.35%	100%

Vernacular SEO

India’s diverse linguistic landscape presents a unique opportunity for vernacular SEO. Creating content in regional languages like Hindi, Gujarati, Telugu, and Bangla can tap into a broader audience base, catering to non-English speakers who are looking for gold loan services.

Vernacular Search Volumes

Category	Search volume FY’22-23	Search volume FY’23-24	Growth %	Market share
Brand	0.18K	0.41K	127.78%	5.47%
Non-brand	4.98K	7.08K	42.17%	94.53%
Total	5.16K	7.49K	45.18%	100%

Gold Loan Usage by Key Demographics

India has a relatively high Gen Z population, made up of people born between the late ‘90s to the early 2000s, comprising over 25% of the population. On the other hand, Gen X and millennials together make up about 63% of the Indian population, according to a World Bank report from 2022.

The loan and finance market is in flux at this time, going through a significant shift in the borrowing market. The younger millennials and Gen Z are the leading contributors to the change in this borrowing behaviour.

The new generations see gold loans as flexible financial tools instead of mere ‘safe’ investments. They are also limited in their incomes and creditworthiness as their careers are just beginning.

However, gold-supported collateral can significantly improve a young individual’s credibility and increase the credit limit allowed to them. And being more comfortable with digital platforms and products, they have positively impacted the resurgence of gold loan online platforms.

NBFCs and fintech companies have virtually streamlined the gold loan management and application process, making them more accessible to borrowers. Banks are also changing their offerings to cater to the needs of young borrowers, including competitive rates of interest and personalized terms of borrowing.

Taking it a step further, banks have also adjusted their marketing strategies to include social platforms, leveraging social platforms and building engaging campaigns suited to the lifestyles and preferences of their Gen Z and millennial audience.

The graph below shared by PwC shows a significant amount borrowed by millennials and Gen Z, which establishes why they are a key target demographic.

Source: PwC analysis

How Many Indians Get Gold Loans?

Another section of borrowers to compare is the urban, rural and semi-urban population of our country. The table below should give you a more structured idea of which section borrows how much.

India’s semi-urban population has seen the highest gold loan disbursements compared to both urban and rural populations. One key factor affecting the low borrowing rate in urban settings might be the availability of choices.

With multiple other financial products and borrowing options to choose from, gold loans might not be their first choice while borrowing. Semi-urban and rural populations might not have many options, and out of those available, gold loans could be the most lucrative for them.

Why Do Consumers Take Gold Loans?

Gold loans can be used in any way desirable, unlike fixed mortgage credit for which you must declare your purpose of borrowing at the start. Since gold loans allow large amounts of cash almost instantly, they are primarily preferred for emergencies or unplanned expenses. This could be medical expenses, weddings, education expenses or urgent home repairs.

For small businesses, gold loans help with instant working capital, debt consolidation and other large-sum requirements. However, while gold loans provide instant cash access, customers must always assess their repayment capabilities before borrowing.

Top Names in the Gold Loan Market in India

According to our findings on Gold Loan Search Trends, 5 NBFCs currently have the highest share of voice when it comes to Google searches regarding gold loans in India, as shown below.

Top Brands	Top 5 SOV
Bajajfinserv.in	33.32%
Bankbazaar.com	27.11%
Muthootfincorp.com	3.28%
iifl.com	2.66%
Paisa bazaar.com	1.74%

According to data shared by Statista, NBFCs dominate the overall gold loan market in India with a market share of about 61%. Meanwhile, banks hold about 39% of the share.

India is the second largest gold importer in the world, with Indians relying on gold as a long-term asset for centuries.

Impact of ‘Near Me’ Searches on Google:

Category	Search volume FY’2022-23	Search volume FY’2023-24	Growth %	Market Share
Brand	21.90K	26.78K	22.28%	55.18%
Non-brand	13.54K	21.75K	60.64%	44.82%
Total	35.44K	48.53K	36.94%	100%

NBFCs also manage 90% of the total AUM (assets under management). They have managed to navigate the major risks associated with the price fluctuations of gold by ensuring a conservative LTV (loan-to-value) ratio of 60-65%, keeping themselves protected against potential losses if the price of gold declines.

Banks Vs. NBFCs Share in the Gold Loan Market

NBFCs (non-banking financial companies) that have focused on gold loan offerings have maintained quite a reasonable market share even with the high level of competition from public sector banks. Additional factors that keep their credit profiles stable include strong capitalisation support, healthy profitability, and a focus on managing risks.

Gold-loan NBFCs have driven AUM (assets under management) growth using three factors:

Customer retention
More small and mid-size loan offerings
More new branches to increase reach

Going by these trends, gold-loan NBFCs have a resilient market share of more than 60%, from March 2021 to September 2023. Public sector banks focus on debtors who seek competitive interest rates and larger loan amounts. Meanwhile, NBFCs are popular for their exceptional customer service, diverse service offerings and digital processes.

Banks have paid greater attention to non-agricultural gold loans, specifically the 3+ lakh loan applications, since 2021. Meanwhile, NBFCs have taken several steps to ensure a sustainable growth rate and a steady market share growing at nearly 10-11%.

Factors Affecting Growth in the Gold Loan Market:

While the rapid resurgence of gold loans was unexpected, there are several factors directly contributing to its growth today and the projections for the market over the next 5 years.

Easy access to credit: Gold loans are an accessible and convenient way to obtain credit without a huge credit score or too much documentation. This makes gold loans a popular financial product, especially among young people and rural and semi-urban populations.
Faster loan disbursal: Gold loans don’t take too long to process or disburse. This is highly valuable in situations that require large amounts of money quickly, such as weddings or medical emergencies.
Lower interest rates: Unsecured loans have a high rate of interest, but gold loans are relatively more cost-effective. For customers looking for credit with a fairly cheap interest rate, this is the perfect financial product.
Shorter loan tenure: Another reason for the rise of gold loans is the short loan repayment tenure, ranging from a couple of months to a year. For people who don’t want a long-term burden of debt, this is the best type of credit.
Regulatory framework: The RBI works to ensure the stability of gold loans and ensure safeguards for both the lender and the borrower. This boosts confidence in gold loans for the customer and provides regulations and guidelines to the lenders regarding LTV ratios, rates of interest and other aspects.
Volatility of gold prices: The volatility of gold also impacts the gold loan market’s growth. In times of economic instability, individuals, businesses and banks leverage their gold assets for quicker liquidation. As a result, the value of gold collateral increases which consequently increases the borrower’s credit capacity.
Growing competition: India’s gold loan market is highly competitive with several banks and NBFCs competing for a share of the market. This has resulted in several innovative financial products, lucrative interest rates and improved customer service.

Gold Loan Market Projected in the Next 5 Years

India’s gold loan market is expected to double in value to reach a valuation of Rs. 14.19 lakh crore by 2029, despite strict regulations and expected moderation according to one PwC India report. In the fiscal period 2023-24, India’s organised gold market showed substantial growth with a valuation of Rs. 7.1 lakh crore according to PwC’s ‘Striking Gold’ report, which predicts a 14.85% CAGR till 2029.

Challenges in the Gold Loan Market

Gold loans in India make up a significant section of India’s secured loan book. However, recovering gold loans has several challenges for banks and lenders. Some of the key challenges include:

Low auction realisation: Prices from gold auctions generally come up shorter than the expected values because of improper valuation methods. This results in financial losses for banks and NBFCs.
The reluctance of customers: Gold has a cultural and emotional significance for owners, which means their attachment to their gold leads to resistance from customers when it comes to the recovery process.
Operation risks: Handling large amounts of pledged gold leads to security and logistical challenges for lenders.

Understanding Gold Loan Market Trends is the First Step

Gold loans have played a significant role in increasing financial inclusion by simplifying credit access for MSMEs and rural populations as well as segments that are new to the world of credit. The overall Google searches for keywords related to gold loans in India have increased by 57.47% in FY 2023-24.

Some key insights from our search trends report are:

The overall Search Volume of ‘Gold Loan’ related keywords has grown by 57.47% in FY’2023-24.
IIFL has shown a growth of 166.98% while Muthoot Finance and Union Bank of India have demonstrated greater than 65% yearly growth in brand search volumes.
Gold loan rate searches have the highest search volumes among all search buckets.

Our Gold Loan Search Trends Report evaluates the changes in customer behaviour and how your business can use these insights and trends to amplify its digital presence. Download and start using it today.

Neha Bawa

Director of Brand Marketing

Neha Bawa is the Director of Brand Marketing at Techmagnate. She has worked in Digital Marketing since 2012 and has specialised in content creation. She has earned a Master's degree in Interactive Communications from Quinnipiac University in Connecticut, U.S.A. Her interests lie in creating great content, dogs, and working towards sustainability through biodiversity.