India's Retail Lending Booms: Gold Loans Lead the Surge

India's retail lending rises in Q2 FY26, led by significant growth in secured large-ticket loans and key consumer credit segments. A report by CRIF High Mark shows an 18% annual increase in loan outstandings, with gold loans as the fastest-growing segment. PSU banks dominate major loan categories.

The retail lending landscape in India saw a continued upward trajectory in Q2 FY26, according to a report by CRIF High Mark. The report highlights solid growth in secured large-ticket loans and a resurgence in key consumer credit segments, driving an 18% year-on-year and 4.5% sequential growth in retail and consumption loan outstandings.

The surge in lending is attributed to a growing demand for gold loans, auto loans, and a revival in personal loans and credit cards. Public sector undertakings (PSUs) have further consolidated their control across several significant loan categories. This growth pattern is based on data up to September 2025.

Gold loans have emerged as the fastest-growing segment, with portfolio outstandings soaring by 35.8% year-on-year and 8.6% quarter-on-quarter, accompanied by a 53% year-on-year rise in originations. Auto loans also reported solid growth, expanding by 16.3% year-on-year, capitalizing on increasing average ticket sizes and a rising share of PSU banks.

Additionally, home loan originations exhibited a robust rebound, rising 25% quarter-on-quarter to Rs 3.02 lakh crore, driven by an 18% increase in volumes and a shift towards high-value loans. Loans exceeding Rs 75 lakh represented 39.4% of originations, with PSUs extending their market share to 50%.

Personal loan portfolios experienced a 12% year-on-year growth, with originations increasing 32% quarter-on-quarter to Rs 2.92 lakh crore. Large-ticket loans above Rs 10 lakh expanded to account for 37.4% of total originations, primarily bankrolled by PSU banks. Two-wheeler loans achieved nearly 15% year-on-year growth, although originations dipped slightly due to monsoon-related seasonality, with higher-value loans in the Rs 1-1.5 lakh range gaining traction.

In Q2 FY26, consumer durable loans displayed moderated sequential demand yet maintained a strong level of yearly growth at 19%. Credit card issuances intentionally slowed, dropping to 44 lakh new cards, even as total outstanding balances climbed to Rs 3.5 lakh crore and delinquencies improved across key risk bands.

(With inputs from agencies.)