Muthoot Finance’s gold loan business is holding up strongly, with growth still near 50% year-on-year as rising gold prices lift collateral values. The firm notes a structural slowdown in volumes: gold tonnage is down and active loan accounts have fallen for the second straight quarter. Management says the decline is driven by shorter loan tenures and churn, not weaker demand. Smaller-ticket loans are shrinking while larger loans gain. Tighter unsecured lending also funnels borrowers toward gold-backed credit.
The IMF projects about $2.5 billion in net income for 2026, rising to $2.6 billion in 2027 and 2028. It expects precautionary balances to reach $35.9 billion by 2026, giving the fund added financial cushioning. The IMF will keep its lending rate margin at 60 basis points for member countries.
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RBI’s repo rate cuts in FY26 were transmitted to borrowers only partially. Weighted average lending rates fell by 93 basis points, but the benefit varied across bank types and loan categories, preventing lending rates from fully matching the policy reduction. Estimates suggest borrowers gained savings of about Rs 19,000 crore, indicating room for faster pass-through.
Microfinance lending rates for the poorest borrowers are rising even though a government credit guarantee scheme was meant to reduce costs. MFIs say their own borrowing is getting more expensive, particularly the higher prices they pay banks for funds. As a result, the increased financing burden is getting passed on to end borrowers.
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