It is believed that the gold pawn companies in India are likely to face a slowdown due to the falling price of the metal in the country and in the global markets.

Customers are increasing such firms to release their pledged gold believing that the prices might fall further in the markets.  The companies are now asking the customers to pay their dues and also increase their pledged gold with the firms. Experts say that the firms might see a slowdown in demand and also more bad loans as for several customers, their pledged gold now costs lesser than the value of their loans.

India's leading gold loan companies, Manappuram Finance and Muthoot Finance Ltd   are increasing facing the risk of loss of business in the current scenario as the gold prices fall to its lowest level in months. In India, the prices have fallen below Rs. 26,000 level while in the international market, the metal has fallen below US$ 1,350 per ounce. The gold prices are falling both in domestic as well as international markets.

The confidence in the gold investment is falling as investors find other avenues for investment and this indicates that the price of gold might fall further in the year. India is the biggest importer of gold in the world and customers buy gold not just as a commodity but also as an investment for the future.