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Reuters
4 days ago
- Business
- Reuters
India cenbank set to ease rules for small-ticket gold loans, governor says
MUMBAI, June 6 (Reuters) - India's central bank will release final regulations for gold lending by Monday, with more relaxed norms for small-ticket lending, governor Sanjay Malhotra said on Friday. In April, the Reserve Bank of India had proposed stricter rules for monitoring and disbursement of gold loans, which are often used by low-income borrowers. The RBI had sought comments on the proposed rules by the middle of May. Last week, the federal finance ministry sought relaxations to the proposed rules, urging the central bank to ensure that small borrowers are not "adversely impacted". The RBI plans to do away with credit appraisal, or the process of evaluating a borrower's creditworthiness, for gold loans up to 250,000 rupees ($2,915) per borrower, Malhotra said in a post-policy press conference in Mumbai. The RBI will also look to increase the loan-to-value ratio for the small-ticket loans to 85% from 75% currently, he said. Moreover, going forward, monitoring of funds lent out will only be needed for so-called priority sector gold loans, the governor said. Shares of Manappuram Finance ( opens new tab rose 4%, while those of Muthoot Finance ( opens new tab and IIFL Finance ( opens new tab gained about 7% and 5%, respectively, on Friday. Separately, the RBI will review and tweak bank ownership guidelines, if needed, Malhotra said. The regulator is considering making it easier for foreign financial institutions to buy larger stakes in Indian lenders, Reuters reported earlier this week. ($1 = 85.7500 Indian rupees)
Yahoo
4 days ago
- Business
- Yahoo
India cenbank set to ease rules for small-ticket gold loans, governor says
MUMBAI (Reuters) -India's central bank will release final regulations for gold lending by Monday, with more relaxed norms for small-ticket lending, governor Sanjay Malhotra said on Friday. In April, the Reserve Bank of India had proposed stricter rules for monitoring and disbursement of gold loans, which are often used by low-income borrowers. The RBI had sought comments on the proposed rules by the middle of May. Last week, the federal finance ministry sought relaxations to the proposed rules, urging the central bank to ensure that small borrowers are not "adversely impacted". The RBI plans to do away with credit appraisal, or the process of evaluating a borrower's creditworthiness, for gold loans up to 250,000 rupees ($2,915) per borrower, Malhotra said in a post-policy press conference in Mumbai. The RBI will also look to increase the loan-to-value ratio for the small-ticket loans to 85% from 75% currently, he said. Moreover, going forward, monitoring of funds lent out will only be needed for so-called priority sector gold loans, the governor said. Shares of Manappuram Finance rose 4%, while those of Muthoot Finance and IIFL Finance gained about 7% and 5%, respectively, on Friday. Separately, the RBI will review and tweak bank ownership guidelines, if needed, Malhotra said. The regulator is considering making it easier for foreign financial institutions to buy larger stakes in Indian lenders, Reuters reported earlier this week. ($1 = 85.7500 Indian rupees) Sign in to access your portfolio
