Mumbai: IFC, a sister organisation of the World Bank, will invest $35 million in Manappuram Finance Limited (MFL) to help low-income households and small enterprises avail loans against their gold assets, Manappuram said in a statement on Tuesday. Gold loan companies offer loans to customers and small businesses by enabling them to monetize their gold without the need for documentary proof of income. India has 23,000 tons of gold with an estimated market value of $1 trillion, Manappuram Finance said citing data from World Gold Council. “However, the current market size of formal gold loans is a mere $19.6 billion, which leaves the field open to pawn-brokers and usurious money lenders in rural areas. According to Jun Zhang, IFC Country Head for India, IFC is making its first investment in a gold-loan finance company to create opportunities for the rural and poor households to transition from informal to formal credit.

Source: Mint May 28, 2019 07:07 UTC