Credit Risk A Rising Concern
The Art of Jewellery|February 2017

As Banks Have Become More Cautious About Their Lending Procedures Due to Mounting Non-performing Assets (Npas), Credit Availability Remains a Constraining Factor for the Gem and Jewellery Industry. Citing Lack of Transparency in the Industry, the Bankers Are Reluctant to Finance Any Gj Business to a Large Extent. However, the Industry Wants Bankers to Initiate Procedures to Share and Adopt Best Practices for Each Others to Minimise Their Risks. Already Paying the Higher Interest Rates on Business Loans Than Other Sectors, the Industry Is Suffering Big-time in This Financial Tug-of-war. Aoj’s Praveer Sinha Finds Out More About the Ongoing Credit Crisis in the Industry.

Credit Risk A Rising Concern

Infusion of more funds into the gem and jewellery industry has become a matter of prime concern, as banks have decided to keep the sector into the high-risk category. Moreover, rising NPA’s and a drop in loan take-off are among other major issues afflicting the jewellery trade. The domestic industry has been facing problem in accessing bank loan since 2013, when the government restricted gold imports to bridge the widening current account deficit (CAD). Earlier, jewellers used to get bank loans at two to four per cent. With the government’s restrictions, banks increased it to 18 per cent and levied penal interest of three per cent on defaulters. According to the Reserve Bank India (RBI) data, the sectoral deployment of bank credit to the gem and jewellery industry amounts to Rs 68,600 crore in December 2016, which was Rs 70,600 crore in December, 2015. The fall in banks exposure has been keeping the GJ industry in a state of unrest. The frequent changes in the government policies related to lending too are compelling the once easygoing industry to device new survival strategies in terms of securing credit.

Rising NPAs in GJ sector

Availability of bank finance to the jewellery industry has shrunk drastically after the NPA crisis in the industry. According to Finance Ministry data, about 5.3 per cent of public sectors banks’ exposure to the GJ industry was non performing in March 2013. In 21 months, by December 2014, this had grown to 14.4 percent.

Bu hikaye The Art of Jewellery dergisinin February 2017 sayısından alınmıştır.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

Bu hikaye The Art of Jewellery dergisinin February 2017 sayısından alınmıştır.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

THE ART OF JEWELLERY DERGISINDEN DAHA FAZLA HIKAYETümünü görüntüle
HRD Antwerp opens diamond and jewellery grading Office in New Delhi
The Art of Jewellery

HRD Antwerp opens diamond and jewellery grading Office in New Delhi

НRD Antwerp celebrated the opening of its new office in New Delhi. Together with the Belgian embassy, a Puja ceremony was held in the new office on Bank Street in Naiwala, Karol Bagh.

time-read
1 min  |
April 2024
This Vishu, welcome the New Year on a special note with Platinum Jewellery
The Art of Jewellery

This Vishu, welcome the New Year on a special note with Platinum Jewellery

As Vishu, the cherished Malayali spring festival, approaches, the anticipation of new beginnings and fresh aspirations fills the air in Kerala and parts of Tamil Nadu.

time-read
2 dak  |
April 2024
Bharat Diamond Bourse Hosts Lunch meeting for the Cricket Legend Sir Geoffrey Boycott and UK Deputy High Commissioner Harjinder Kang
The Art of Jewellery

Bharat Diamond Bourse Hosts Lunch meeting for the Cricket Legend Sir Geoffrey Boycott and UK Deputy High Commissioner Harjinder Kang

The iconic Bharat Diamond TB Bourse (BDB) was honored to host an exclusive luncheon and conversation event featuring two distinguished guests: the legendary cricketer Sir Geoffrey Boycott and Harjinder Kang, UK Deputy High Commissioner for Western India &Trade Commissioner for South Asia.

time-read
1 min  |
April 2024
A Glimpse into the GIA Alumni Collective, Chennai Chapter "Meet and Greet" Event
The Art of Jewellery

A Glimpse into the GIA Alumni Collective, Chennai Chapter "Meet and Greet" Event

this insightful: evening featuring a aia discussion on Bridging Getections in the Jewelry Industry’ was hosted during the GJIIF 2024, Chennai.

time-read
2 dak  |
April 2024
Malabar Gold & Diamonds Achieves Record Annual Turnover Exceeding Rs 50,000 Crore Indian Rupees
The Art of Jewellery

Malabar Gold & Diamonds Achieves Record Annual Turnover Exceeding Rs 50,000 Crore Indian Rupees

Malaba alabar Gold & Diamonds announces a milestone achievement with an annual retail global turnover of Rs 51,218 Crore Indian Rupees in the last financial year.

time-read
2 dak  |
April 2024
Gold prices are on fire Gold prices have been on fire, jumping 20% in just the past 2 months.
The Art of Jewellery

Gold prices are on fire Gold prices have been on fire, jumping 20% in just the past 2 months.

That takes gold t toa near-doubling since pre-pandemic, when it was meandering aicnge at cil 1500. While going to press it closed above 2400.

time-read
3 dak  |
April 2024
Celebrate the auspicious occasion of Gudi Padwa with rare and precious Platinum
The Art of Jewellery

Celebrate the auspicious occasion of Gudi Padwa with rare and precious Platinum

As Maharashtra and other A western states of India rejoice in the festive spirit of Gudi Padwa, people embrace the rich traditions of the Marathi new year.

time-read
2 dak  |
April 2024
Divine Solitaires launches Solus, a range of premium yellow diamond jewellery
The Art of Jewellery

Divine Solitaires launches Solus, a range of premium yellow diamond jewellery

Divine Solitaires, launched its premium range of vivid and intense yellow diamond jewellery under the name of Solus by Divine Solitaires. These rare and premium, natural yellow diamonds evoke the warmth of the sun and brilliance of a stars.

time-read
1 min  |
April 2024
Shaping the Future of Gem & Jewellery Industry with Design Gallery Initiatives and Gem and Jewelry Career Center by GIA India
The Art of Jewellery

Shaping the Future of Gem & Jewellery Industry with Design Gallery Initiatives and Gem and Jewelry Career Center by GIA India

In an exclusive interview at IIJS Tritiya in Bangalore, Sriram Natarajan, Managing Director of GIA India speaks to Sumesh Wadhera, Chief Editor, AOJ about \"How Design Gallery initiative encourages Budding Designers\" and on the sideline he also talks about creating job opportunities through Gem and Jewelry Career Center by GIA India

time-read
2 dak  |
April 2024
GJEPC unveils exclusive Gem & Jewellery Show in Jaipur for international buyers
The Art of Jewellery

GJEPC unveils exclusive Gem & Jewellery Show in Jaipur for international buyers

GIBPC JEPC hosted the 3rd edition of International Gem & Jewellery Show (IGJS) in Jaipur. The event, powered by Gemfields, is being held from 12th to 14th April at Novotel Jaipur Convention Centre, Jaipur.

time-read
2 dak  |
April 2024