Gold loans firms' FY22 book to grow at 18-20% on tiny biz demand: Crisil

Working capital needs drive uptick in demand; gold loans taken by individuals support uptrend

After witnessing contraction in the first quarter, the gold loan companies may see 18-20 per cent rise in Assets Under Management (AUM) in Fy22 on uptick in demand from micro-businesses and individuals.

Rating agency Crisil said the business of the finance companies which offer loan against gold was hit in the first quarter of FY22 when the pandemic-driven lockdown measures hindered branch operations and kept potential borrowers away.

Now the demand for gold loans from micro enterprises to fund working capital and individuals has risen with the pick-up in economic activity. The onset of the festive season coincides with the easing of