Full-page advertisements for auction of gold jewellery by leading financial institutions operating in the segment have become a common sight in Indian newspapers over the last few months, indicating severe economic distress faced by Indian households.
Loans against gold jewellery, typically considered to be the last resort used by many households and small businesses facing severe fund crunch, saw a sharp increase during the Covid-19 pandemic as many households suffered loss of jobs and livelihoods. But the inability of the borrowers to repay the loans is leading to a surge in auction of gold jewellery, industry experts said.
