Private sector lender, Induslnd Bank is soon going to offer gold loans to diversify its portfolio, said Mr. Romesh Sobti, Managing Director and Chief executive officer.
Mr. Sobti said, "Gold loan is a critical product in the Indian context and, for many borrowers; it has emerged as a great way to raise short-term capital in an expeditious manner".
With less than 2 per cent of the country's gold holding being used as collateral for availing loans, any gold loan product has huge potential, according to Mr. Sobti.
He further added, "Pledging of gold ornaments and assets to local money lenders and pawnbrokers has been in vogue in India for centuries. Now, this business is gradually moving to the organized sector. The objective is very clearly to unleash the potential of the gold saved across households in the country".
Mr. Sobti feels that despite of the presence of big players like Muthoot Finance and Mannapuram Finance, there is enough space for other financial intermediaries to enter gold loan segment.