National News
RBI issues guidelines for loans against silver
The Reserve Bank of India (RBI) has introduced a formal, standardized framework for loans against silver, which will be fully effective from April 1, 2026. These new guidelines bring silver lending under a unified regulatory umbrella, similar to existing gold loan regulations, to protect borrowers and formalize the market.
Key RBI Guidelines for Loans Against Silver
The “Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025” establish the following rules for all regulated entities, including commercial banks and Non-Banking Financial Companies (NBFCs):
- Eligible Collateral: Only silver jewellery, ornaments, and coins with a minimum purity of 925 (sterling silver) are accepted.
- Ineligible Collateral:Â Loans cannot be offered against primary silver (bullion, bars, or slabs), or financial products like Silver Exchange-Traded Funds (ETFs) or mutual funds.
- Collateral Limits: A borrower can pledge up to a maximum of 10 kilograms of silver ornaments and up to 500 grams of silver coins.
- Loan-to-Value (LTV) Ratio:Â The maximum LTV (loan amount as a percentage of the silver’s value) is tiered based on the loan amount:
- 85%Â for loans up to Rs.5 lakh.
- 80% for loans between Rs2.5 lakh and ₹5 lakh.
- 75%Â for loans above Rs.5 lakh.
- Valuation:Â Silver collateral is valued based on its intrinsic value and actual purity. The reference price will be the lower of (a) the average closing price over the preceding 30 days or (b) the closing price of the preceding day, as published by the India Bullion and Jewellers Association Ltd. (IBJA) or a SEBI-regulated commodity exchange.
- Loan Purpose:Â The guidelines cover loans for consumption and income generation purposes. Lenders are generally prohibited from extending loans for the speculative purchase of silver.
- Borrower Protection: Lenders must follow standardized procedures for purity checks, provide clear loan terms in the borrower’s language, and securely store the collateral. Penalties are in place for delayed release of collateral after full repayment (₹5,000 per day after seven working days).
- No Re-pledging:Â Lenders are prohibited from re-pledging the silver collateral to other entities.Â
National News
GJC Delegation Meets RBI Deputy Governor, Makes GMS Presentation
The Proposal Was Acknowledged As An Innovative Initiative With The Potential To Become A Game Changer For The Industry and The Nation.
A GJC delegation comprising Vice Chairman Avinash Gupta, Legal Consultant CA Bhavin Mehta, and National Secretary Mitesh Dhorda met with Shirish Chandra Murmu, Deputy Governor of the Reserve Bank of India, along with his senior team.
During the meeting, the delegation made a detailed presentation on the proposed Gold Monetization Scheme (GMS). The RBI team appreciated the concept of the scheme. The proposal was acknowledged as an innovative initiative with the potential to become a game changer for the industry and the nation.
GJC remains committed to working closely with all stakeholders —including the government, banks, jewellers, gold depositors, and temple trusts—in the larger national interest and for the sustainable growth of the GJ industry.
The Gold Monetization Scheme (GMS) in India was launched with the primary objective of reducing gold imports by mobilizing the vast amount of idle gold held by households, institutions, and temple trusts, thereby decreasing the country’s heavy reliance on gold imports. By encouraging depositors to bring their unused gold into the formal banking system, the scheme puts this dormant gold into productive economic purposes, such as meeting the needs of jewellers and industries without requiring fresh imports.
Additionally, the scheme allows depositors to earn interest on their gold deposits instead of keeping gold idle at home, transforming a non-yielding asset into an income-generating investment while simultaneously strengthening India’s gold supply chain and reducing the trade deficit.
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