The Reserve Bank of India (RBI) has announced a major policy reform allowing banks to offer loans against silver jewellery and coins, a move aimed at benefiting poor and middle-class families. Until now, only gold was accepted as collateral for loans, leaving those who invest in silver without similar access to credit. The new guidelines, which will take effect from April 1, 2026, mark a significant step toward broadening financial inclusion and offering relief to rural and semi-urban households that rely heavily on silver as a form of savings.
Good news for middle-class people, Silver is the new Gold!
From Apr 2026, you can get loans by pledging silver, not just gold!
Banks, NBFCs & co-ops can lend against silver jewellery or utensils (not bars or coins).
Only for real needs-education, health, farming, or business. pic.twitter.com/B1TO2UmhxI— Deepak Gupta (@deep3115) November 8, 2025
According to the RBI’s directives, individuals can pledge up to 10 kilograms of silver ornaments or 500 grams of silver coins to avail loans. The Loan-to-Value (LTV) ratio has been categorized based on the loan amount—up to 85% for loans up to Rs 2.5 lakh, 80% for loans between Rs 2.5 lakh and Rs 5 lakh, and 75% for loans exceeding ₹5 lakh. The valuation of pledged silver must be carried out in the borrower’s presence to ensure transparency.
The guidelines also emphasize borrower protection, mandating banks to return pledged silver on the day of loan closure or within seven working days. Any delay will attract a penalty of ₹5,000 per day. In the event of a loan default, banks must provide adequate notice before auctioning the pledged silver, ensuring the reserve price is at least 90% of the prevailing market value. Any surplus from the auction beyond the loan amount must be refunded to the borrower within seven working days. The move is widely seen as a progressive measure to strengthen financial access for the middle class and rural communities.