Explanation:
Statement 1 is incorrect. The RBI's prohibition on granting advances against primary gold/silver applies to all lenders including both commercial banks and NBFCs. The draft guidelines issued by RBI on April 9, 2025, explicitly bar all lenders from granting advances against primary gold/silver and financial assets backed by them.
Statement 2 is correct. The data shows that while commercial banks hold the majority share of gold loan outstanding (₹9,23,636 crore), the proportional increase in NPAs was higher in NBFCs. NBFCs reported gold loan NPAs of ₹4,784 crore (compared to ₹3,904 crore the previous year), representing a higher percentage increase relative to their portfolio size compared to banks.
Statement 3 is correct. The practice of "evergreening" in gold loans, which was curtailed by RBI in September 2023, did allow borrowers to indefinitely extend loans by just paying the interest component. After RBI's intervention, repledging now requires full repayment of both principal and interest, making the process costlier and limiting loan evergreening.
Statement 4 is correct. Under the new regulatory framework, consumption gold loans with bullet repayment structure (where principal and interest are due at maturity) must have a maximum tenor of 12 months. Income-generating gold loans are subject to different parameters and are not bound by this specific tenor restriction.
Explanation:
Statement 1 is incorrect. The RBI's prohibition on granting advances against primary gold/silver applies to all lenders including both commercial banks and NBFCs. The draft guidelines issued by RBI on April 9, 2025, explicitly bar all lenders from granting advances against primary gold/silver and financial assets backed by them.
Statement 2 is correct. The data shows that while commercial banks hold the majority share of gold loan outstanding (₹9,23,636 crore), the proportional increase in NPAs was higher in NBFCs. NBFCs reported gold loan NPAs of ₹4,784 crore (compared to ₹3,904 crore the previous year), representing a higher percentage increase relative to their portfolio size compared to banks.
Statement 3 is correct. The practice of "evergreening" in gold loans, which was curtailed by RBI in September 2023, did allow borrowers to indefinitely extend loans by just paying the interest component. After RBI's intervention, repledging now requires full repayment of both principal and interest, making the process costlier and limiting loan evergreening.
Statement 4 is correct. Under the new regulatory framework, consumption gold loans with bullet repayment structure (where principal and interest are due at maturity) must have a maximum tenor of 12 months. Income-generating gold loans are subject to different parameters and are not bound by this specific tenor restriction.