New Delhi, March 6 -- Reserve Bank of India plans to ask lenders to follow stricter underwriting processes for gold loans and monitor the end-use of funds as it tries to cool growth in the fast-growing segment, seven people, including industry sources and those aware of the regulator's thinking, said.

According to Reuters, the RBI wants banks and non-banks to also bolster background checks on borrowers and ascertain the ownership of the gold that is being mortgaged, according to sources who spoke to Reuters

"The RBI wants to ensure that the entities are following a standard protocol and any growth in the gold loan sector is not out of bounds," one of the sources aware of the central bank's thinking, said.

"It wants to make sure that an...