Editor’s Note
The Reserve Bank of India has expanded permissible collateral for loans to include silver, issuing new ‘Gold and Silver (Loans) Directions, 2025.’ This move, effective April 1, 2026, aims to provide greater financial flexibility by allowing individuals to leverage silver assets similarly to gold.
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New Delhi | The Reserve Bank of India (RBI) has made a major decision. People will now be able to take loans against silver (Silver Loan), similar to how loans are currently available against gold (Gold Loan). For this, the RBI has issued the ‘Gold and Silver (Loans) Directions, 2025’, which will come into effect from April 1, 2026. The new guidelines detail who can give the loan, how much silver or gold can be pledged, and what the maximum loan limit will be. This step is considered a major relief for rural and middle-class populations.
According to RBI’s new rules, the following institutions can now provide silver loans:
– All commercial banks (including Small Finance and Regional Rural Banks)
– Urban and Rural Co-operative Banks
– NBFCs (Non-Banking Financial Companies) and Housing Finance Companies
– Gold jewellery – up to a maximum of 1 kg
– Silver jewellery – up to a maximum of 10 kg
– Gold coins – up to a maximum of 50 grams
– Silver coins – up to a maximum of 500 grams
Loans will not be available against bullion (pure gold or silver) or Gold ETFs/Mutual Funds.
– Up to 85% for loans up to ₹2.5 lakh
– Up to 80% for loans between ₹2.5 lakh and ₹5 lakh
– Up to 75% for loans above ₹5 lakh
This means if you have silver worth ₹1 lakh, you could get a loan of up to ₹85,000.
Banks or NBFCs will consider the average closing price of the last 30 days or the previous day’s price (whichever is lower) as the standard. This rate will be taken from IBJA (India Bullion and Jewellers Association) or a recognized commodity exchange.
Valuation will be done in the presence of the customer. All documents will be provided in the customer’s local language. Jewellery will be kept in the bank’s secure vault. Additionally, the bank will conduct periodic inspections.
The RBI has clarified that banks must return the jewellery or silver within seven working days of loan repayment. If there is a delay due to the bank’s fault, a compensation of ₹5,000 per day will have to be paid.
The bank will first issue a notice. After one month, the auction process will begin. The reserve price will not be less than 90% of the current market price. If the auction fails twice, it can be reduced to 85%.
If the customer does not claim the jewellery or silver even 2 years after repaying the loan, the bank will declare it as ‘unclaimed collateral’ and run a special campaign to contact the customer or heirs.
RBI’s step is seen as a relief for small investors and rural areas, where silver is also used as an asset. Now, immediate cash needs can be met using silver, just like gold.
