Loan Against Mutual Funds
Unlock liquidity by leveraging your mutual fund investments without redeeming them.
Loan Against Mutual Funds
A loan against mutual funds is a financial product that allows investors to
borrow money from banks or non-banking financial companies (NBFCs) using
their mutual fund holdings as collateral. This option provides liquidity to
investors without the need to sell their mutual fund units, thereby allowing
them to remain invested for long-term growth.
One of the main advantages of a loan against mutual funds is liquidity. It
provides immediate access to cash without disrupting long-term investment
plans. The flexibility of this financial product means that it can be used for
various purposes, such as funding emergencies, education, or catering to
urgent financial needs, while still benefiting from the potential market
appreciation of mutual fund investments.
Overall, a loan against mutual funds is an attractive option for investors seeking
quick access to funds while maintaining their investment strategy.
How much loan can you get against mutual funds?
The amount of loan you can get against mutual funds depends on the Loan-to-Value (LTV) ratio set by the lender. It is the ratio between the amount of loan you can borrow and the current market value of the mutual funds you pledge as collateral. The exact loan amount may vary based on the LTV ratio, the type of mutual funds you hold, the lender's policies, and your overall financial profile. Normally for any equity Funds Loan value ranges from 40 to 50% and or Debt mutual funds up to 90%.
Features and Benefits of a Loan Against Mutual Funds
Opting for a Loan Against Mutual Funds has several compelling advantages, such as.
Quick Access to Funds
Meet urgent financial needs through seamless processing and a fast turnaround time (subject to eligibility and documentation).
No Need to Redeem Mutual Funds
You continue to earn returns and avoid exit loads or tax implications associated with premature redemption.
High Loan-to-Value (LTV)
Depending on the type of mutual fund and your eligibility, you can typically avail an LTV of 50% to 85%*.
Interest Rates
Competitive Loan Against Mutual Funds interest rates help optimise the cost of borrowing.
No Prepayment Charges*
Enjoy the flexibility to repay early without incurring prepayment penalties on your instant loan on mutual funds.<br/>*Terms and Conditions apply.
Eligibility criteria and documents required for loan against mutual funds
Applying for a loan against mutual funds is easy and convenient.Simply meet the basic eligibility criteria and keep the required documents ready to proceed.
Eligibility Criteria
You should be between 18 and 75 years of age
Your entire mutual fund portfolio should not be less than ₹50,000
You should hold Mutual Funds approved with CAMS & Kfintech (RTAs). Debt &
ELSS funds are not eligible.
Joint mutual fund holders are not eligible for loan
You should be an Indian resident
Documents Required
(This is an end-to-end digital process. Hence, no physical documents are
required to be submitted.)
Aadhaar number
PAN Number
Bank IFSC code
Bank Account number
Mobile number associated with your Aadhaar & Bank account
Get instant liquidity without selling your mutual fund investments.
Apply for Loan Against MF