Consumers will get more benefits with increased LTV, they will get more amount than previous and the total business of the companies will also increase. Consumers will get gold loan from the companies instead of going to mini jewelers or businessmen.
Ups and downs of in gold rates will also control with gold loan policy. Muthoot finance is expecting to achieve 20-25% increment in their business. Reserve bank of India has submitted the report in which Loan-to-value ratio has increased by 60% to 75%. Company will get more benefits with this increment.
With the increment in LTV the company has got good business within year 2012. Muthoot finance has 65-70% part in total gold loan business of the country. RBI has said that the increment in LTV ratio consumers will get profit of 20-25%. Jewellery production will not involve in LTV because NBFC gives loan by including the gold rate and making charge. The report also includes the profit of 102% on the development of gold loan since three years.