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Gold Loan Market in India 2020

Gold Loan Market in India 2020

In India, gold is considered to be a sign of social status, financial security and cultural legacy. As of 2019, households in India assembled about 25,000 tons of gold, making the country the largest holder of the yellow metal in the world. Rural communities account for ~65% of the total gold demand in the country. Owing to the sentimental value that Indians associate with this indispensable item, people seldom sell it to meet financial emergencies. They prefer to pledge gold as collateral to secure short-term loans. Gold loans enjoy a relatively low interest rate that varies between 9.5% and 24%, and have a flexible tenure (ranging from a few days to 5 years).
The gold loan market in India was valued at ~INR 2,921.42 Bn in 2019 and is expected to reach ~INR 6,275.40 Bn by 2025, expanding at a compound annual growth rate (CAGR) of ~12.75% during the 2020-2025 period.
Segment insights:
The Indian gold loan market is segmented into organized gold loan market, also known as formal gold loan market and unorganized gold loan market or the informal gold loan market. The organized gold loan segment includes public banks, private banks, small finance banks, co-operative banks, NBFCs and Nidhi companies. In contrast, the unorganized sector is dominated by money lenders and pawnbrokers.
The unorganized segment accounts for more than 60% of the gold loan market in the country. Nevertheless, the organized sector is anticipated to expand exponentially during the forecast period.
NBFCs constitute the largest share of the organized market. Customers residing in rural parts of the country are gradually switching to these NBFCs, owing to quick loan processing, systematic gold valuation, auctioning and safe-keeping. Banks also offer gold loans, but they primarily consider these as their priority sector lending (PSL) requirements. Further, small finance and Nidhi companies represent the co-operative segment in the Indian gold loan industry, and account for ~12.98% of the organized gold loan market. Private sector banks are gradually entering the Indian gold loan market with tech-driven offerings like online gold loan services.
Impact of COVID-19:
The Indian gold loan market has witnessed a positive impact on business during the nationwide lockdown due to the Coronavirus pandemic. Gold loan products have experienced rapid growth than other retail banking products during this period. Due to economic distress and job losses, gold is acting as an insurance policy, as well as a retirement plan across India. People are availing gold loans to fulfill their immediate fund requirements.
Moreover, demand for gold loan is further expected to expand as risk profiles of borrowers have depreciated considerably and lenders are becoming risk-averse. Many NBFCs are facing liquidity crisis, which is deteriorating their liquidity capacity. Therefore, gold loans are becoming a fallback plan for borrowers who are denied loan through regular channels.

Companies covered:
• Axis Bank of India
• Central Bank of India
• Federal Bank Limited
• HDFC Bank Limited
• ICICI Limited
• Kotak Mahindra Bank Limited
• Manappuram Finance Limited
• Muthoot Finance Limited
• State Bank of India
• Union Bank of India
Chapter 1: Executive summary

Chapter 2: Socio-economic indicators

Chapter 3: Introduction

3.1. Market definition and structure
3.2. India gold loan industry evolution
3.3. Gold loan value proposition

Chapter 4: Market overview
4.1. Demand for gold in India
4.1.1. India’s share in global gold demand
4.2. India gold loan market overview
4.2.1. Market size and growth forecast (2018-2025e)
4.3. Operational benchmarking

Chapter 5: Market segmentation
5.1. Indian gold loan market share based on category
5.2. Organized gold loan market size and growth forecast (2019-2025e)
5.3. Organized gold loan market share based on player type
5.4. Unorganized gold loan market size and growth forecast (2019-2025e)

Chapter 6: Consumer analysis
6.1. Consumer analysis
Chapter 7: Impact of COVID - 19
7.1. Impact of COVID - 19

Chapter 8: Market trends
8.1. Market trends

Chapter 9: Market influencers
9.1. Market drivers
9.2. Market challengers

Chapter 10: Competitive landscape
10.1. Product benchmarking
10.2. Axis Bank Limited
– Company information
– Business description
– Products/services
– Key people
– Financial snapshot
– Key ratios
– Key financial performance indicators
– Key business segments
– Key geographic segments
Note: Similar information covered for all other public companies. Private companies' data given on best effort basis.

10.3. Central Bank of India
10.4. Federal Bank Limited
10.5. HDFC Bank Limited
10.6. ICICI Limited
10.7. Kotak Mahindra Bank Limited
10.8. Manappuram Finance Limited
10.9. Muthoot Finance Limited
10.10. State Bank of India
10.11. Union Bank of India

Chapter 11: Online gold loan
11.1. Online gold loan operating model
11.2. Digital gold and centralized storage
11.3. Rupeek Fintech Private Limited

Chapter 12: Recent development
12.1. Recent development

Chapter 13: Acronyms

13.1. Acronyms

Chapter 14: Appendix

14.1. Research methodology
14.2. About Netscribes
14.3. Disclaimer

Report Title: Gold Loan Market in India 2020

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