How does rising gold prices help Muthoot and Manappuram? Suppose a person borrows from one of the gold financing players, and the prices of the metal rises, the value of the collateral used to secure the loan increases. This is because if a borrower comes with gold worth Rs 100 as collateral, the gold financing company gives a loan of only Rs 70. So there is always a buffer. So where do the current market conditions put these players?
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