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SBI to expand its gold lending business and launch premium banking services




The State Bank of India (SBI) will put more emphasis on gold loans for personal and agricultural use after lending over Rs 1 trillion in this segment till June 2022.

The country’s biggest lender marked its founding day on Friday by announcing premium services for affluent customers, a new version of its YONO personal loan and WhatsApp banking. It opened 31 new central processing centers (CPCs) for urban and semi-urban centers for products such as education loans.

SBI Chairman Dinesh Khara said that under inflationary conditions, gold is seen as a preferred investment class. If it becomes a preferred asset class, there will be traction for gold lending.

The bank has seen much better growth (for gold loans) than at the same time last year. He declined to comment on specific targets, citing regulatory restrictions ahead of first-quarter results.

SBI distributes gold credits in two segments – agriculture and personal loans segment.

The bank’s agriculture cold loan portfolio grew to Rs 73,601 crore in FY22 from Rs 66,878 crore in FY2021.

As of the end of FY 2022, over 2.4 million Agri Gold loans amounting to Rs 37,500 crore have been sanctioned through YONO Krishi, according to the bank’s annual report for the exercise 22.

In the retail segment, the gold loan portfolio grew by 9.89% year-on-year to reach Rs 23,063 crore at the end of March 2022.

Khara said retail lending continued to be an “important driver for us.” “The way he has grown in the past. We expect to take advantage of the growth potential. He will continue to look at all opportunities, whether it is corporate or SME.”

SBI will launch premium banking services on a pilot basis in Hyderabad and the Mumbai metropolitan circle. After evaluation, it would be extended nationwide. “The goal is to turn them (emerging affluent customers) into early-stage wealth banking customers,” Khara said. Assets under management of the Wealth Bank are over one trillion rupees.

Gain traction

  • 24% of SBI’s share of system gold loans
  • The lender also provides gold loans to MSME units
  • Rs 73,752 cr gold personal loans in the banking system



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