Muthoot lent 43% more against less gold

Credit No. 108 2 November 2026 · 1 min read · By Pranami Hayaran

Muthoot Finance's gold loans grew 43% in a year to ₹1,78,956 crore, its September 2026 results show. But it did this without holding more gold. The gold in its lockers actually fell from 209 to 204 tonnes.

The business is simple. You give Muthoot your gold jewellery and it lends you money against it. If you fail to repay, it sells the gold. So its loans can grow either by collecting more gold or by lending more against the same gold.

This year, the second did most of the work. Loan accounts rose 8%, but the average loan grew 33%. Muthoot now lends ₹8,772 per gram, up from ₹5,977 a year ago. Rising gold prices helped: gold was worth ₹10,566 per gram in September 2025 and ₹12,942 by June 2026, its presentation says.

But Muthoot's loans grew faster than gold prices. The gap between the value of its gold and the money it has lent against it, called the margin of safety, fell from 43% in September 2025 to 36% in June 2026. RBI rules introduced in April 2026 allow loans of up to ₹2.5 lakh to reach 85% of the gold's value, for the entire loan period.

Muthoot is lending more against less gold. Higher gold prices have helped it grow, but they have also made the business more dependent on gold retaining its value. If prices fall, the cushion protecting its loans could shrink further.

2 lines from March 2025 to September 2026, both starting at 100: gold loans climb every quarter to about 174, while gold held stays near 100, dips to about 94 in March 2026 and ends at about 98.

2 lines from March 2025: the gold price per gram rises from ₹8,167 to ₹13,441 in March 2026 and slips to ₹12,942 in June 2026; the loan per gram rises every quarter from ₹4,950 to ₹8,772 in September 2026.

6 bars from March 2025 to June 2026: 39%, 38%, 43%, 44%, 41% and 36%, the last the lowest.

Sources