Mumbai, Sep 30 (PTI) The Reserve Bank of India (RBI) has allowed banks to grant need-based working capital loans to manufacturers using gold as raw material, extending the provision currently available only to jewellers.

Banks are generally prohibited from lending for the purchase of gold/silver in any form, or lending against the security of primary gold/silver.

However, a carve-out has been allowed by the RBI for scheduled commercial banks (SCBs) for granting working capital loans to jewellers.

The Reserve Bank of India (Lending Against Gold and Silver Collateral) (1st Amendment) Directions, 2025 issued on Monday, has extended the carve-out for granting any need-based working capital requirements of a borrower that uses gold as a raw material or input in its manufacturing or industria

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