PSU banks lose gold loan sourcing share as private banks, NBFCs gain traction: Report

Public sector banks’ dominance in gold loan sourcing is gradually facing pressure as private banks and NBFCs gain traction, according to the report.

This is supported by stronger distribution reach, faster turnaround times and changing customer preferences, according to an Experian report titled ‘Gold Loans in Transition: Market Evolution & Consumer Patterns’.  “The market structure is gradually shifting toward private and NBFC-led sourcing, highlighting stronger distribution reach, faster turnaround times, and growing customer preference for non-bank lenders in the gold loan segment,” the report said. According to the report, the gold loan market share of public sector banks based on sourcing value stood at 37 per cent in Q4FY26, as against 45 per cent in Q4FY25, and 53 per cent in Q2FY26.

Similarly, shares of NBFCs have increased to 44 per cent in Q4FY26, from 33 per cent in a year ago, and 22 per cent in Q2FY25.

“Among financial institutions, NBFCs have emerged as the fastest-growing lender category, steadily gaining market share over the past few quarters and overtaking public sector banks in sourcing contribution by FY26 Q4.

Public sector banks, although still a significant contributor, have consistently ceded market share, reflecting increasing competitive pressure from agile NBFC lenders,” report added.

Further, Public Banks are dominating the Priority Sector Gold Loans (PSGL)market, holding around 88 per cent of market share in Q4FY26 (-2 per cent drop year-on-year) and PSGL contributes around 42 per cent to their gold loan sourcing value in FY26.