RBI Gold Loan Rules 2026: LTV Slabs, Valuation and Return of Gold

Under the RBI’s gold lending rules, which lenders had to adopt by 1 April 2026, you can borrow up to 85% of your gold’s value on consumption loans up to ₹2.5 lakh. The cap falls to 80% up to ₹5 lakh and 75% above that. Once you repay, the lender must return your gold within seven working days or pay you ₹5,000 for each day of delay.

Key facts

What changed, and which loans the rules cover

Before these directions, gold loans carried a flat 75% LTV cap for every borrower, as Ujjivan Small Finance Bank’s explainer notes. The 2025 directions raised the cap for smaller loans and put banks, co-operative banks and NBFCs under one set of rules.

A loan sanctioned before your lender adopted the new directions stays under the older rules. Any renewal or new loan after adoption follows the new ones.

The LTV slabs apply to consumption loans, meaning any loan not taken for a productive purpose. Loans for farming, business or buying productive assets count as income-generating loans and sit outside this table. Our gold loan guide compares rates and EMIs; this page covers only the rules.

The three LTV slabs, and what they mean per gram

The slab depends on your total consumption loan against gold with that lender, not on each loan separately.

A worked example, using an illustrative reference price of ₹10,000 a gram for your gold’s purity:

• 20 grams are valued at ₹2,00,000. The loan stays under ₹2.5 lakh, so 85% applies: up to ₹1,70,000, or ₹8,500 a gram.
• 40 grams are valued at ₹4,00,000. An 85% loan would cross ₹2.5 lakh, so the 80% slab applies: up to ₹3,20,000.

For a bullet repayment loan, the LTV is worked out on the full amount due at maturity, interest included. With interest at 12% a year for 12 months, the 20-gram loan above could start at about ₹1,51,800, so that principal plus interest stays within ₹1,70,000. Check the actual gold price on our gold loan rate per gram page.

The cap applies for the whole loan, not only on day one. If gold prices fall and your loan crosses the limit, the lender acts under its own board-approved policy, so ask what that policy says before you sign.

How lenders must value your gold

1. The lender takes the lower of two prices published by the India Bullion and Jewellers Association (IBJA) or a SEBI-regulated commodity exchange: the average closing price of the previous 30 days, or the previous day’s closing price.
2. It uses the price for your gold’s actual purity (caratage). The directions set no minimum carat.
3. Only the gold content counts. Stones, gems and making charges add nothing.
4. Assaying happens in your presence, and staff must explain deductions for stones, fastenings and similar items.
5. You get an assay certificate showing purity, gross weight, net gold weight, deductions, any damage, a photo of the items and their value at sanction.

Lenders must display their valuation method publicly. They also cannot lend against gold bars, gold ETF or mutual fund units, or give a loan to buy gold.

Bullet repayment and renewal

In a bullet loan you pay principal and interest together at the end. For consumption loans, that tenure is capped at 12 months.

You can renew or top up a loan only if it is a standard (non-defaulted) account and stays within the LTV cap. A bullet loan can be renewed only after you pay the interest accrued so far. If your total borrowing against gold goes above ₹2.5 lakh, the lender must also assess your repayment capacity. If you prefer monthly payments, run the numbers in our EMI calculator.

The loan agreement and Key Facts Statement must list every charge, including assaying and auction costs, and the notice period before an auction. Communication must be in the regional language or a language you choose.

Return of gold: 7 working days and compensation

After you repay or settle the loan in full, the lender must return your gold the same day, and within seven working days at most. The same applies to your legal heirs if the borrower has died.

• For every day beyond seven working days that the lender causes, it pays you ₹5,000.
• If the gold is damaged while pledged, the lender pays for the repair.
• Any loss, or any shortfall in weight or purity, must be compensated.

Compare the items with your assay certificate when you collect them. Gold left with the lender for more than two years after closure is treated as unclaimed.

Auction: notice periods and your rights

• The lender must give you notice to repay before starting an auction.
• If you cannot be traced, it may auction only one month after a public notice.
• The auction must be advertised in at least two newspapers: one in the regional language and one national daily.
• The reserve price must be at least 90% of current value, falling to 85% only after two failed auctions.
• The first auction is held physically in the district of your branch. Later ones can be in an adjoining district or online.
• The lender and its related parties cannot bid.
• Any surplus after dues must reach you within seven working days of the lender receiving the auction money.

Complaints: lender first, then the RBI Ombudsman

1. Write to the lender’s grievance officer with your loan number and the rule it broke.
2. Wait 30 days for a reply.
3. If there is no reply, or the reply does not resolve it, file on cms.rbi.org.in under the Reserve Bank – Integrated Ombudsman Scheme, 2026, in force from 1 July 2026.
4. File within 90 days of the reply period ending or the lender’s last reply, whichever is later.

Filing is free, and the helpline is 14448. Our RBI Ombudsman guide walks through the form.

Frequently asked questions

What is the maximum gold loan LTV under RBI rules?

85% of the gold’s value for total consumption loans up to ₹2.5 lakh, 80% above ₹2.5 lakh up to ₹5 lakh, and 75% above ₹5 lakh.

How much gold loan can I get per gram?

Multiply your gold’s net weight by the lender’s reference price for its purity, then apply the LTV slab. At an illustrative ₹10,000 a gram, a small loan could reach ₹8,500 a gram.

Is there a limit on how much gold I can pledge?

Yes. Across all your loans with a lender, gold ornaments cannot exceed 1 kg and gold coins cannot exceed 50 grams.

Can I renew a gold loan without paying interest?

Not a bullet loan. Accrued interest must be paid first, the account must be standard, and the renewed loan must be within the LTV cap.

How soon must the lender return my gold?

The same day you close the loan, and within seven working days at most, or it pays you ₹5,000 for each day of delay it causes.

Can a lender auction my gold without telling me?

No. It must send notice first, and if you cannot be traced it must wait one month after a public notice.

Do the new rules apply to my old gold loan?

A loan sanctioned before your lender adopted the directions continues under the earlier rules.

Sources

• Reserve Bank of India (Lending Against Gold and Silver Collateral) Directions, 2025 — Reserve Bank of India (checked 16 Sep 2026)
• FAQs on Reserve Bank – Integrated Ombudsman Scheme, 2026 — Reserve Bank of India (checked 16 Sep 2026)
• Complaint Management System — Reserve Bank of India (checked 16 Sep 2026)
• Gold loan LTV ratio explained — Ujjivan Small Finance Bank (checked 16 Sep 2026)