Indiagold, a gold loan originating business correspondent (BC) company, is looking to apply for a non-banking finance company (NBFC) license in FY25, co-founder Deepak Abbot told businessline in an interaction.
Abbot, a former Paytm executive, says the BC originates gold loans for three banks from eight cities and has staff strength of 264 employees. The BC is aiming to originate ₹7,000 crore of gold loans in FY26 and FY27 each, add four-five new cities each year, and raise staff strength to 400 by FY25 end and hire another 300 employees in the next fiscal.
After receiving the NBFC license, Abbot says the existing partnerships with three banks will continue, and the license will make lenders more comfortable in partnering with the BC for gold loans. NBFC license would also enable the company to create more customised products.
Business model
According to Abbot, like Urban Company, interested gold loan customers can book appointment for a home visit from Indiagold’s online platforms. Upon confirmation of the appointment, Indiagold’s staff then visits the customer’s house to measure the gross and net weight of the gold and the caratage, based on which the customer is made aware of the amount of loan they can get against gold.
“We offer a doorstep gold loan product. Through our app or website, you schedule an appointment, we will go to your house, we will do gold loan processing and deposit the gold to bank branch,” he said, adding that after arrival of the gold in bank branch, lenders independently conduct gold assaying.
The BC is further targeting to partner with banks which have lesser branches or don’t offer gold loans from every branch.
RBI scrutiny
The RBI on September 30 issued a notification saying that few lenders who partnered with fintechs or BCs for gold loans adopted irregular practises like carrying out valuation of gold in the absence of customer, doing credit appraisal and valuation by the BC itself, storing gold in the custody of BC and using internal accounts for disbursement as well as repayment of loans, among others.
When asked about the same, Abbot says at Indiagold, 100 per cent of gold valuation is done in front of customers. Further, a loan cannot proceed unless bank’s approval is received.
“Regulator during its annual audit has contracted independent gold valuers to check the valuation of Indiagold assayed gold & cleared our valuation standards. The last regulatory audit was done in May 2024,” Abbot said.
