RBI Update: RBI gives big relief to gold loan borrowers, new rules implemented..

RBI has made significant changes in the gold loan rules, giving relief to small borrowers. Now the loan-to-value (LTV) ratio for gold loans up to Rs 2.5 lakh has increased from 75% to 85%. This change will be effective from April 1, 2026, allowing borrowers to get more loans against their gold.

Earlier, RBI Governor Sanjay Malhotra told reporters that the RBI has proposed to increase the LTV ratio to 85 percent for small loans less than Rs 2.5 lakh. He said that the LTV ratio will also include the interest component.

What does the increase in loan-to-value ratio mean?

This means that you will now get more loans on gold! If you pledge gold worth ₹ 1 lakh, then instead of Rs 75,000, you will now be able to get a loan of up to Rs 85,000. This change will be beneficial for small businessmen and the middle class, as it will provide them with more money to meet their small needs.

What is the loan-to-value ratio?

Loan-to-value (LTV) is the ratio that determines how much loan you can take on the value of gold. With this decision of RBI (RBI New Guideline), if you have gold worth Rs 1 lakh, then you will get a loan of up to Rs 75,000 and if you have less than Rs 2.5 lakh, then you will be able to take a loan up to 85 percent.

Since the process of a gold loan is fast. So if you suddenly need money, then you can take a loan by mortgaging the gold you have. Gold is also seen as a safe investment to get financial help in difficult times. On the other hand, after this announcement of the Reserve Bank of India, there was a stir in the shares of companies providing gold loans.

Disclaimer: This content has been sourced and edited from Hr Breaking. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.