Gold-backed lending has emerged as one of the fastest-growing segments within the banking system, sustaining triple-digit growth through May 2026 and reshaping the composition of retail credit. According to the latest sectoral data released by the Reserve Bank of India (RBI), loans against gold jewellery expanded by 105.5% year-on-year to approximately Rs 5.1 lakh crore, significantly outperforming the broader personal loan portfolio, which grew 15.4% to ₹70.2 lakh crore.

The remarkable momentum in gold lending stands in contrast to the moderation witnessed across several major retail credit categories. Housing loans, which continue to constitute the largest share of personal lending, recorded growth of 10.9%, while credit card outstanding increased by a modest 1.3%. Consumer durable financing contracted by 2.6%, highlighting a broader cooling in discretionary borrowing.

As a result, gold loans have assumed a larger role within the personal credit ecosystem. Their share in total personal loans rose to 7.3% in May 2026, compared with 4.1% a year earlier and just 1.97% in May 2024. Over the past two years, this represents an increase of 5.4 percentage points. Notably, gold-backed lending contributed nearly 28% of the incremental expansion in personal loans between May 2025 and May 2026, despite accounting for a relatively modest proportion of the overall portfolio.

The moderation in traditional retail segments also weighed on the overall share of personal loans within total bank credit, which declined to 32.6% from 33.3% a year earlier. Other personal loan categories grew by 12.5%, remaining below the banking system’s aggregate credit growth of 17.7%.