I covered the gold loan market in my Chapter 1 & 2 (links in comments) but lot of people asked how can the market be so big. Do we have so much gold in India?
✴ The answer is that we have lot more gold in India than we can even imagine. Official figures by World Gold Council pegged this at 25000 tonnes (in a 5 year old analysis). That number is being quoted everywhere in analyst presentations of Banks, NBFCs and Fintechs.
✴ But if we just go back 12 years, India imported over 15000 tonnes including 5000 tonnes since the last WGC report. So OFFICIALLY we have over 30,000 tonnes (that’s roughly $2 trillion)
✴ Globally over 2.5 lakh metric tonne gold has been mined which means over 12% of that is in India alone.
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✴ The demand is not slowing down despite multiple new asset classes available for Indians to invest in last 5 years. Demand for jewellery continues to grow. It crossed over $77bn in FY23 after recovering from covid slowdown 2 years back. The jewellery market is higher than gold imports as significant amount of old gold is recycled for new jewels
✴ RBI hold roughly 795 tonnes out of 30,000 tonnes. Over 200 tonnes is institutional holding in India while Indian temples alone hold over 1600 tonnes.
✴ As per NCAER study, 140mn households in India have some amount of gold savings.
Chapter 1 — https://growthbug.com/indias-gold-story-chapter-1-the-market-size-its-yoy-growth-12cb5a03b7e4
Chapter 2 — https://growthbug.com/indias-gold-story-chapter-2-kerala-and-its-love-for-gold-20b719d4cfdb
