Gold loan industry seeks deferment of new norms citing geopolitical uncertainty

New Delhi: The Association of Gold Loan Companies (AGLOC) has sought a six month deferment of the Reserve Bank of India's (RBI) revised guidelines on lending against gold and silver collateral, scheduled for implementation by April 1, 2026, citing emerging geopolitical uncertainty and risks to credit access.

The revised framework, scheduled for implementation on or before April 1, 2026, aims to strengthen regulatory frameworks and promote responsible lending practices.

In representations to the RBI, Finance Ministry and Department of Financial Services, given the current environment and the need to ensure continued credit access, a calibrated deferment will enable a smoother and more effective implementation.


AGLOC said the global environment remains marked by heightened uncertainty, particularly due to the evolving conflict in the Middle East, which could disrupt energy and fuel supply chains, trigger inflationary pressures and impact cash flows of households and small businesses, it said.

Given the current environment, it said, there is a temporary mismatch in customer cash flows driven by disruptions in business activity, particularly in segments linked to fuel, LPG, and logistics, along with increased cost of agricultural inputs affecting borrowers in the agriculture sector.

A calibrated and phased approach to implementation would help ensure a smoother transition while maintaining uninterrupted access to credit for these segments, it said.

It added that such conditions are likely to disproportionately affect the lower and middle income segments that rely on timely access to formal credit, it said.

It further said that the gold loans play a counter cyclical role in providing immediate liquidity, supporting consumption during income volatility and enabling continuity for small and informal sector businesses.