RBI Proposes 9 Key Reforms in Draft Guidelines for Gold Loan Regulations. Banking & Finance | Dated: 31 May 2025 In May 2025, the Reserve Bank of India (RBI) released draft guidelines aimed at standardizing the process for issuing gold loans by banks and Non-Banking Financial Companies (NBFCs) to individual borrowers. 🎯 Key Highlights: - The proposed guidelines focus on creating uniform rules and procedures to ensure greater transparency and risk management in the gold loan segment. - RBI proposes allowing only specific forms of gold as collateral and capping the loan-to-value ratio to prevent over-lending. - Mandatory gold valuation procedures, proper documentation, and recordkeeping will be enforced to ensure transparency and borrower protection. 💡 Other Important Facts: (i) Key Proposals from RBI’s Draft Guidelines on Gold Loans (May 2025): Borrowers can avail loans up to 75% of the gold’s value, compared to the earlier 80% limit allowed temporarily during the COVID-19 pandemic. (ii) Borrowers must provide valid proof of ownership for the gold pledged. In absence of original purchase receipts, a declaration explaining the ownership source must be submitted. (iii) Lenders must ensure proper documentation and verification of ownership, improving transparency and accountability in the gold loan process. 📚 Test Your Knowledge: Recently, what is the Loan-to-Value (LTV) ratio cap proposed by RBI in its draft guidelines for gold loans? Correct Answer: 75% 🚀 Quick Recap: About RBI Governor : Sanjay Malhotra Headquarter : Mumbai