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Gold loans shine brightest in India’s retail credit segment

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According to Reserve Bank of India (RBI) data, outstanding loans against gold jewellery soared 103% to ₹2.09 lakh crore as of March 2025, up from ₹1.03 lakh crore a year earlier, making gold loans the fastest-growing category even as overall bank credit growth slowed

Several factors have converged to fuel this remarkable expansion:

  • Rising Gold Prices: The value of pledged jewellery increased as gold prices surged, enabling borrowers to secure larger loans against the same collateral.
  • Regulatory Shifts: The RBI’s crackdown on unsecured lending, particularly personal and microfinance loans, prompted both banks and non-banking finance companies (NBFCs) to pivot toward secured lending products like gold loans
  • Loan Reclassification: In 2023, the RBI directed banks to reclassify certain agricultural loans as gold loans, further boosting the reported figures
  • Shift from Informal to Formal Sector: Regulatory tightening and digital onboarding have encouraged borrowers to move from informal lenders to banks and NBFCs, especially in southern India where gold-backed lending is deeply entrenched

Market Impact and Outlook

Gold loans now account for approximately 3.5% of total retail credit, up from 1.2% five years ago 

Lenders highlight the appeal of gold loans for their low credit risk and quick disbursal, with repeat customers often leveraging rising gold prices to refinance or increase their borrowing limits.

Contrary to popular perception, gold loans are not limited to financially distressed borrowers. Banks report growing demand from small businesses and middle-class households seeking short-term working capital, with average ticket sizes exceeding ₹1 lakh and low default rates.

 

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Education

The Science Behind Sparkle: How Lab-Grown Diamonds Are Created

A New Era of Diamond Creation

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In recent years, lab-grown diamonds have captured the attention of jewellers, consumers, and investors alike. Beyond their beauty, what makes these gems truly fascinating is the science behind their creation. Unlike imitation stones, lab-grown diamonds share the same physical, chemical, and optical properties as natural diamonds — the only difference lies in their origin.

At the heart of this innovation are two cutting-edge processes: High Pressure High Temperature (HPHT) and Chemical Vapor Deposition (CVD). These methods recreate the intense conditions under which natural diamonds form deep within the Earth, allowing scientists to produce genuine diamonds in a controlled laboratory environment.

HPHT: Diamonds Born Under Extreme Conditions

The High Pressure High Temperature (HPHT) method mimics the natural diamond-forming process that occurs about 150 kilometers below the Earth’s surface.

  1. Starting Point – The Seed:
    A small diamond seed, usually a thin slice of an existing diamond, is placed inside a carbon-rich chamber.
  2. Simulating Nature – Pressure and Heat:
    The seed is exposed to extreme conditions — pressures of about 5–6 GPa (equivalent to the pressure at the Earth’s mantle) and temperatures of 1,400–1,600°C.
  3. Crystal Growth:
    Under these conditions, the carbon source melts and crystallizes around the diamond seed, forming a larger crystal over several weeks.

The result is a high-quality diamond crystal that is virtually indistinguishable from its natural counterpart. HPHT diamonds often exhibit exceptional clarity and can be produced in a range of sizes and colors, including colorless, yellow, and blue varieties.

CVD: Diamonds Grown in a Plasma Cloud

The Chemical Vapor Deposition (CVD) process is a more recent innovation that uses advanced plasma technology to grow diamonds atom by atom.

  1. Preparing the Chamber:
    A thin diamond seed is placed inside a vacuum chamber filled with carbon-rich gases, typically methane and hydrogen.
  2. Creating Plasma:
    The gases are energized using microwaves or lasers, forming a plasma cloud that breaks down the molecular bonds of the gases.
  3. Diamond Formation:
    Carbon atoms released from the plasma settle onto the seed layer, crystallizing into pure diamond over the course of several weeks.

The CVD method allows for greater control over purity, color, and size, making it ideal for high-end jewellery applications. It also produces diamonds that are free from many of the inclusions typically found in natural stones.

Technology Meets Sustainability

Both HPHT and CVD processes are transforming the jewellery industry not only through technology but also through sustainability. Lab-grown diamonds require no mining, dramatically reducing environmental impact. Many manufacturers are also transitioning to renewable energy sources to power their production facilities, making these diamonds even more eco-conscious.

Furthermore, traceability is a defining advantage. Every lab-grown diamond can be tracked from its creation, offering complete transparency — a growing priority among modern consumers seeking ethical luxury.

Crafting the Future of Jewellery

As consumer awareness grows, lab-grown diamonds are redefining what it means to own something precious. With their scientific precision, sustainable creation, and stunning beauty, they represent the perfect harmony between innovation and artistry.

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JewelBuzz is Asia’s First Digital Jewellery Media & India’s No.1 B2B Jewellery Magazine, published by AM Media House. Since 2016, we’ve been the trusted source for jewellery news, market trends, trade insights, exhibitions, podcasts, and brand stories, connecting jewellers, retailers, and industry professionals worldwide.

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