Poonawalla Fincorp Ltd (PFL) has officially entered the gold loan segment, marking a strategic expansion of its secured lending portfolio. The move aims to address rising credit needs across India, especially for individuals and small businesses in Tier 2 and Tier 3 cities.

This latest initiative reflects PFL’s commitment to enhancing financial inclusion by offering reliable credit solutions backed by physical assets. With a reputation for transparent financial services and an eye on underserved markets, Poonawalla Fincorp is positioning itself to capture a larger share of the rapidly growing gold loan sector.

A New Chapter in PFL’s Secured Lending Strategy

Gold loans allow customers to leverage their gold holdings without selling them, thereby preserving their long-term wealth while meeting short-term liquidity needs. These loans are popular among:

• Farmers managing agricultural expenses

• Small traders and business owners expanding operations

• Families handling personal emergencies or large expenses

PFL's entry into this space reflects a strategic pivot towards low-risk, asset-backed lending that offers better returns and stability.

400 New Branches in Tier 2 and Tier 3 Cities

To support this new offering, Poonawalla Fincorp has unveiled an aggressive expansion plan — 400 new branches over the next four quarters. The focus will be on Tier 2 and Tier 3 cities, where access to formal financial institutions remains limited.

This approach aligns with the company’s long-term vision to penetrate deeper into semi-urban and rural India, thereby democratizing access to secured credit.

These branches will act as dedicated touchpoints for gold loan services, ensuring local customers receive personalised assistance and secure handling of their gold assets.

Why Gold Loans? A Look at the Market Potential

Gold remains a trusted financial asset in Indian households. With an estimated 25,000 tonnes of privately held gold in India, the market for gold-backed loans is both massive and under-leveraged.

PFL sees gold loans as:

• Lower risk lending instruments, as the collateral is held upfront

• Cushion against economic uncertainty, especially during market volatility

• Appealing for customers wary of unsecured debt like personal loans or credit cards

The gold loan segment is growing steadily, with non-banking financial companies (NBFCs) playing a significant role. Poonawalla Fincorp aims to use its operational expertise and customer-first philosophy to build a solid presence.

Flexible Repayment and Customer-Centric Services

PFL is offering customised repayment options, allowing borrowers to choose a structure that fits their financial capabilities. This may include:

• Monthly EMIs

• Bullet repayments at the end of the tenure

• Interest-only repayments during the loan period

These options are designed to cater to diverse customer segments, including those with seasonal incomes like farmers or self-employed individuals.

The company is also ensuring:

• Transparent interest rates

• No hidden charges

• Quick disbursal process

• Safe and secure storage of gold

Risk-First Approach to Lending

Poonawalla Fincorp has always maintained a risk-first approach to lending. This principle is embedded into its gold loan operations to ensure:

• Robust asset verification procedures

• Strict internal controls

• Secure logistics for gold handling

• Regulatory compliance

By focusing on risk mitigation, the company ensures that its expansion into secured lending remains sustainable and profitable.

Strengthening Footprint Across India

Currently operating in 18 states and 2 union territories, PFL has a total Assets Under Management (AUM) of ₹35,550 crore as of March 31, 2025. The addition of the gold loan product will diversify its portfolio and strengthen its brand in the retail lending ecosystem.

The plan to add 400 new branches is not just about numbers—it’s about enhancing local access, building brand trust, and creating employment opportunities in those areas.

Part of the Cyrus Poonawalla Group

As a part of the Cyrus Poonawalla Group, PFL carries forward the legacy of financial credibility and innovation. Known for excellence in healthcare (through Serum Institute of India), the Group’s foray into financial services has already built trust among investors and borrowers alike.

This entry into the gold loan vertical underlines the group’s long-term interest in growing across essential sectors of the Indian economy.

Conclusion: A Step Towards Inclusive Lending

Poonawalla Fincorp’s launch of its gold loan services comes at a time when formal financial services are needed most in semi-urban and rural India. By offering secure, transparent, and flexible loan options, the company is helping individuals and businesses unlock the value of their gold without compromising their long-term financial security.

The 400-branch rollout plan, combined with a focus on Tier 2 and Tier 3 cities, signifies a clear strategic commitment to empowering underserved communities and deepening financial inclusion.

This move not only expands the company’s lending portfolio but also strengthens its position as a diversified NBFC, ready to serve the evolving needs of the Indian borrower.

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