How to take a Loan Against Shares

Check how to take loan against shares and unlock the value of your investments.
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3 minutes
11-November-2025

Loan Against Shares (LAS) is a smart financing option that lets you unlock the value of your shareholdings without selling them. It allows you to pledge your shares as collateral and access funds quickly to meet personal or business needs. If you are wondering how to take a loan against shares, the process is simple. You can apply online through a lender, link your Demat account, and get funds disbursed within hours once your securities are pledged. This makes it an efficient way to manage liquidity while retaining ownership of your investments. Unlike traditional loans, LAS offers lower interest rates, quick approval, and flexible repayment options, giving you access to funds without disrupting your long-term wealth creation.

What is a loan against shares?

A loan against shares is a type of secured loan that allows you to borrow funds by pledging your shares as collateral. Instead of selling your investments, you can use their market value to access liquidity for short-term or long-term needs such as business expansion, emergency expenses, or personal commitments. The loan amount is determined by the lender based on the value of the shares pledged and the applicable Loan-to-Value (LTV) ratio. This facility helps you retain ownership of your shares, continue earning dividends, and benefit from potential market appreciation while still meeting your financial requirements

Why consider a Loan Against Shares?

Here are some reasons why you might consider a Loan Against Shares (LAS):

  • Preserve your investments: You can access funds without selling your valuable shares.
  • Lower Interest rates: LAS often comes with lower interest rates compared to traditional unsecured loans.
  • Quick disbursement: The loan approval and disbursement process is usually faster than traditional loans.
  • Flexible repayment: Many lenders offer flexible repayment options to suit your financial needs.
  • Tax benefits: In some cases, the interest paid on a loan against shares may be tax-deductible.                                

Eligibility criteria for loan against shares

To be eligible for a loan against shares from Bajaj Finance, you must meet the following requirements:

  • You must be a resident of India
  • Your age should be between 21 years to 90 years
  • You must be self-employed or a salaried employee
  • You should have a minimum holding of shares worth Rs. 50,000

Corporates, HUFs, LLPs, partnerships, trusts, and sole proprietorships can apply for loan against shares of up to Rs. 1,000 crore by reaching us at las.support@bajajfinserv.in.

Documents required to avail loan against shares

To apply for a loan against shares, you need to submit a few basic documents for identity, address, income, and share ownership verification. These help the lender assess eligibility and process the loan faster. Below is a list of commonly required documents:

Proof of identity: Passport, PAN card, voter ID, or driving licence.

Proof of address: Recent utility bills, Aadhaar card, passport, or rental agreement.

  • Income proof: Latest salary slips, bank statements, or income tax returns (for salaried or self-employed individuals).
  • Demat account statement: A recent statement reflecting the shares you plan to pledge.
  • Passport-size photographs: As required for verification and documentation purposes.
  • Loan application form: A duly filled and signed application with accurate details.

Providing complete and valid documents ensures faster approval and seamless disbursal of your loan against shares.

Loan Against Shares
Loan Against Mutual Funds

How to take a loan against shares: Step-by-step process

Below is a step-by-step process to avail a loan against shares:

Step 1: Meet the eligibility criteria

Before applying for a loan against shares from Bajaj Finance, ensure that you meet all the eligibility requirements. If you do not meet the eligibility criteria, your loan application may get rejected.

Step 2: Check the loan amount

The maximum loan amount that Bajaj Finance offers against shares is up to 50% of the value of your shares. So, check the current market value of your shares to know how much loan amount you can avail of.

Step 3: Submit the application form

Once you confirm the loan amount, the next step is to submit the loan application form online.

Step 4: Provide the required documents

To process your loan application, you need to submit the following documents:

  • KYC documents (Aadhaar/ passport/ voter’s ID)
  • PAN card
  • Demat holding statement

Step 5: Wait for approval

Disbursement shall be done post successful verification and pledging.

Factors to consider before applying Loan Against Shares

Consider these factors before taking a Loan Against Shares.

  • Market volatility: Fluctuations in share prices can impact the loan amount and repayment.
  • Margin calls: Potential requirement to deposit additional funds or sell shares.
  • Interest rates: Compare rates from different lenders.
  • Repayment capacity: Ensure you can meet repayment obligations.
  • Regulatory compliance: Understand the rules and regulations.
  • Long-term financial goals: Assess the impact on your investment strategy and risk tolerance.

Interest rates and loan terms on loan against shares

Interest rates and terms vary based on your profile and the value of pledged shares. As a secured loan, it typically offers lower rates than unsecured options. Here are the key aspects to know:

  • Interest rates: Usually range from 8% to 15% per annum, depending on the type and value of shares pledged.
  • Loan amount: Determined by the Loan-to-Value (LTV) ratio, which typically ranges up to 50% of the share’s market value.
  • Tenure: Flexible repayment terms, often extending up to 36 months or more.
  • Interest calculation: Charged only on the amount utilised from the sanctioned limit, helping manage interest costs efficiently.
  • Repayment options: Can include interest-only monthly payments with principal repayment at the end of the tenure, or regular EMI-based plans.

Benefits of taking a Loan Against Shares from Bajaj Finserv

Here are some key benefits of taking a Loan Against Shares (LAS) from Bajaj Finserv:

  • Quick disbursement: Receive funds quickly to meet urgent financial needs.
  • Minimal documentation: A streamlined process with minimal paperwork.
  • Competitive interest rates: Enjoy attractive interest rates on your loan.
  • Flexible repayment options: Choose a repayment plan that suits your budget.
  • Online application and tracking: Manage your loan conveniently through digital platforms.
  • No prepayment charges: Repay the loan early without any penalty fees.
  • Top-up facility: Access additional funds as needed.
  • Easy eligibility criteria: Simple eligibility requirements to qualify for the loan.

Conclusion

In conclusion, taking a loan against shares from Bajaj Finance is a straightforward process. By following these steps, you can apply for a loan against your shares and get the necessary funds to meet your expenses.

Disclaimer

While care is taken to update the information, products, and services included in or available on our application, website and related platforms, there may be inadvertent inaccuracies or typographical errors or delays in updating the information. The material contained in this site, and on associated web pages, is for reference and general information purpose and the details mentioned in the respective product/service document shall prevail in case of any inconsistency. Subscribers and users should seek professional advice before acting on the basis of the information contained herein. Please take an informed decision with respect to any product or service after going through the relevant product/service document and applicable terms and conditions.

*Terms and conditions apply

Frequently asked questions 

Can I sell my pledged shares during the loan tenure?

No, you cannot sell pledged shares while the loan is active. They remain with the lender as security until the loan is fully repaid.

Is there any risk in taking a loan against shares?
Can I prepay my loan against shares?

Yes, most lenders allow partial or full prepayment of the loan against shares without penalties. Check with your lender for specific terms.

How long is the tenure for a loan against shares?

Loan tenures typically range from a few months to 3 years, depending on the lender’s policy and the value of the pledged shares.

What happens if I default on my loan?

If you default, the lender has the right to sell your pledged shares to recover the outstanding dues. It may also impact your credit score.

Are there any alternatives to a loan against shares?

Yes, alternatives include personal loans, loan against mutual funds, loan against fixed deposits, or even a loan against property, depending on your needs and assets.

What shares are eligible to pledge?

You can pledge shares that are listed and actively traded on recognised stock exchanges. The eligibility depends on the company’s market capitalisation, liquidity, and inclusion in the lender’s approved list of securities.

How is the loan amount calculated?

The loan amount is determined by the Loan-to-Value (LTV) ratio, usually 50% of the market value of pledged shares. The exact amount varies based on share type, market volatility, and lender policies.

Can multiple loans be taken against different shares?

Yes, you can take separate loans against different shares or portfolios, depending on each lender’s policy. However, each loan is treated independently with its own terms, conditions, and repayment structure.

What happens if I default?

In case of default, the lender has the right to sell pledged shares to recover the outstanding amount. This may also affect your credit score and future borrowing eligibility.

How quickly can I get a loan against shares?

Once shares are verified and pledged, funds are usually disbursed within 24 to 48 hours. Online processes have made approvals faster, especially when your Demat and KYC details are readily available.

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