National News

SEBI proposes new framework for valuation of gold and silver in ETFs to standardize mutual fund industry practices

New SEBI framework aims to bring transparency and standardization to gold and silver ETF valuations, aligning practices across mutual funds.

Published

7 months ago

July 29, 2025

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The Securities and Exchange Board of India (SEBI) has issued a proposal to introduce a uniform valuation mechanism for gold and silver Exchange Traded Funds (ETFs), marking a significant step towards improving consistency, transparency, and efficiency across the mutual fund industry.

In its consultation paper, SEBI recommends the adoption of domestic spot prices for valuing physical gold and silver assets held by ETFs, replacing the current use of the London Bullion Market Association (LBMA) price in U.S. dollars. At present, different mutual fund houses follow varied valuation methods, which may lead to duplication of effort and inconsistencies in the Net Asset Value (NAV) calculations of these funds.

The move is expected to align the valuation of physical and derivative assets, reduce operational complexity, and better reflect the local market conditions. SEBI believes this change will benefit investors by enhancing comparability and fairness across all gold and silver ETFs.

This proposal reflects SEBI’s commitment to evolving with the changing needs of the financial ecosystem and promoting best practices in asset valuation. Market participants, stakeholders, and the public are invited to share their comments and suggestions on the proposed framework by August 6, 2025.

National News

Outstanding gold-backed loans surge by 128% from a year earlier

Published

12 hours ago

February 28, 2026

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India’s appetite for borrowing against gold is reshaping the country’s credit landscape. Outstanding gold-backed loans have surged 128% from a year earlier, crossing Rs.4 lakh crore ($48 billion) for the first time, according to data from the Reserve Bank of India. As of Jan. 31, loans secured by gold jewellery stood at Rs.4,00,517 crore, marking one of the fastest expansions in retail credit in recent years.

The boom in gold loans has helped propel overall non-food bank credit growth to 14.4% year-on-year. Personal loans now account for 34.5% of total bank lending, outpacing other segments and underscoring a broader shift toward consumer-driven credit expansion

Gold loans alone contributed roughly 9% of incremental bank credit during the period. Between January 2024 and January 2026, outstanding gold-backed credit rose by nearly Rs.3.1 lakh crore—an increase of about 338% over two years—more than quadrupling the size of the portfolio.

Two factors are driving the surge. First, gold prices have climbed roughly 152% over the past two years, increasing the collateral value of household holdings. Second, regulatory guidance requiring banks to classify loans secured by gold explicitly as gold loans has sharpened reporting and accelerated balance-sheet growth in the segment.

The trend highlights a distinctive feature of India’s financial system: households’ vast stock of physical gold, long viewed primarily as a store of wealth, is increasingly being mobilized as collateral for formal credit.

While personal lending and credit to nonbank financial companies within the services sector continue to expand rapidly, industrial credit remains uneven. Loans to micro, small and medium enterprises are growing steadily, but borrowing by large corporations has stayed relatively muted.

Since March 21, 2025, banks have added Rs.21.8 lakh crore to their non-food loan books, translating into 12% growth for the financial year to date. Yet it is gold—rather than factories or infrastructure—that is emerging as one of the most dynamic engines of India’s current credit cycle.