RBI’s Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025, issued on 6 June 2025 with compliance due by 1 April 2026, cap loan-to-value at 85% for loans up to ₹2.5 lakh, 80% above ₹2.5 lakh up to ₹5 lakh and 75% above ₹5 lakh, limit bullet repayment loans to 12 months, value collateral on IBJA or exchange prices, require gold to be returned within seven working days of repayment with ₹5,000 a day compensation for lender delays, and set auction rules.
| AREA | REQUIREMENT |
|---|---|
| Loan-to-value (consumption loans) | 85% up to ₹2.5 lakh; 80% above ₹2.5 lakh up to ₹5 lakh; 75% above ₹5 lakh, per borrower, maintained through the tenor |
| Bullet repayment loans | Tenor up to 12 months, renewable subject to the renewal conditions |
| Valuation | Lower of the 30-day average closing price and the previous day’s closing price for the purity, from IBJA or a SEBI-regulated commodity exchange; only the metal’s intrinsic value counts, not stones |
| Credit assessment | Required where total gold and silver loans to a borrower exceed ₹2.5 lakh |
| Weight limits per borrower | Ornaments: 1 kg gold, 10 kg silver; coins: 50 g gold, 500 g silver |
| Return of collateral | Same day, and no later than seven working days after full repayment; ₹5,000 per day compensation for delays attributable to the lender |
| Loss or damage | Lender compensates the borrower and bears repair costs |
| Auctions | Notice to borrower, announcement in a regional and a national newspaper, reserve price at least 90% of current value (85% after two failed auctions), first auction physical in the same district, no bidding by the lender or related parties, surplus refunded within seven working days |
| Prohibited | Loans against primary gold or silver; re-pledging collateral |
The directions apply to all NBFCs, including housing finance companies. Loans sanctioned before a lender adopted them continue under the earlier rules. RBI has amended these directions since issue, so check the current text on the RBI website.
This is the first of our three reconciliation streams for NBFCs. See NBFC reconciliation.
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