By Dimpal Gulwani and Siddhi Nayak BENGALURU/MUMBAI (Reuters) -Shares of India's IIFL Finance surged 13% on Friday, after the country's central bank revoked an earlier ban on the non-bank lender's gold loan business.

IIFL Finance Limited shares on Friday (September 20) experiences a sharp increase in its stock price. This surge in stock prices was in response to a major announcement from the Reserve Bank of India (RBI).

The regulator had on September 19 lifted restrictions on the gold loan lender. This would allow the lender to restart its gold loan operations but brokerages expect that the lender would look at growing slowly as it will look at keeping all the compliance measures in check.

Shares of IIFL Finance rose as much as 13 per cent to Rs 560.60 after the Reserve Bank of India ( RBI ) lifted restrictions on the company' gold loan business. The RBI had imposed restrictions on IIFL for disbursing gold loans on March 4.

Jefferies has upgraded IIFL Finance to 'Buy', saying that an improvement in earnings visibility will support the company's better multiples.

The RBI's decision will allow the company to resume the sanctioning, disbursal, assignment, securitisation, and sale of gold loans, says the NBFC