Gold loan firms such as Muthoot and Manappuram on Thursday demanded parity with banks that have been allowed to lend up to 90 per cent of the value of collateral.
The RBI increased from 75 per cent to 90 per cent the permissible loan-to-value ratio (LTV) for banks to give loans against pledge of gold ornaments and jewellery for non-agricultural purposes. The Association of Gold Loan Companies ( AGLOC) held an emergency meeting and said the measure would fail to have an impact in the absence of parity in the applicable LTV.
AGLOC Vice-Chairman Thomas George Muthoot said the member companies played a signifi-cant role in financial inclusion by extending adequate and timely credit to low-income groups and weaker sections of the society.