Loan against Mutual Fund Eligibility criteria and Documents required

Read on to know the criteria required to apply for our loan against mutual funds.

Eligibility criteria and documents required

Anyone can apply for our loan against mutual funds online, as long as they meet the four basic criteria mentioned below. Also keep a few documents handy while applying for loan against mutual funds.

Eligibility criteria

  • Nationality: Indian
  • Age: 18 to 90 years
  • Employment: Salaried, self-employed
  • Security value: Minimum Rs. 50,000

Documents

  • PAN card
  • KYC documents: Aadhaar/ passport/ voter’s ID
  • Consolidated Account Statement

Corporates/ HUF/ LLP/ Partnership/ Trust/ Sole Proprietorship can apply for loan against mutual funds of up to Rs. 1000 crore, by reaching us at las.support@bajajfinserv.in.

More details

To be eligible for a loan against mutual funds, two important criteria are the fund types available in your portfolio (equity, debt, etc) and the value of the mutual funds lien marked. Check the approved list of mutual funds. If you are ready to apply, make sure to have all the necessary documents ready to be uploaded online.

After submitting your application, our representative will guide you on the next steps. The loan amount will be transferred to your bank account upon verification of your application. Note that terms and conditions apply, and if you need more information, you can explore the links at the top of this page.

How to apply for a loan against mutual funds

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Step-by-step guide to apply for loan against mutual funds

Step 1: Click on the ‘Apply Now’ button.
Step 2: Enter your mobile number to Sign in and click ‘GET OTP’.
Step 3: Enter the OTP sent to your mobile number. On successful verification, you will be redirected to our online application form.
Step 4: Enter your basic details like – PAN, DOB and email ID.
Step 5: Check your loan eligibility by entering your security name and quantity.
Step 6: Choose the loan amount you wish to avail.
Step 7: Get your KYC done using Digilocker or by manually uploading the documents.
Step 8: Enter your bank details and verify.
Step 9: Proceed for e-agreement and e-mandate by authenticating it via OTP.
Step 10: Your loan will be disbursed after successful pledging and verification

Frequently asked questions

What are the eligibility criteria to apply for a loan against mutual funds?

The eligibility criteria to apply for a loan against mutual funds are:

  1. Securities: You should have a minimum share of Rs. 50,000.
  2. Ownership: You should be the owner of the securities and have clear and marketable title to them.
  3. Age: You should fall under the age bracket of 18 to 90 years.
  4. Type of mutual funds: Your funds should be under the approved list of 5000 + funds.
What are the documents required to apply for a loan against securities?

Some of the documents required to apply for loan against mutual funds are:

PAN card

For KYC verification you need either of these documents: Aadhaar, passport or voter’s ID.

Along with this you need to provide a copy of the mutual fund statement, which shows the value of your mutual fund holdings.

How does a loan against a mutual fund work?

A loan against a mutual fund works by allowing investors to borrow money against the value of their mutual fund holdings. This type of loan is also known as a "loan against securities" or "margin funding."

To obtain a loan against a mutual fund, investors must pledge their mutual fund units as collateral with the lender. The lender will then lend a certain percentage of the value of the mutual fund units, which can typically range from 50% to 80%. The loan amount and interest rate will vary depending on the mutual fund and the lender.

The loan can be used for any purpose, such as for personal or business expenses, or for investing in other securities. The borrower will be required to pay interest on the loan amount, typically at a higher rate than the mutual fund's returns. The borrower will also be required to repay the loan within a specified period, which can range from a few months to a few years.

If the borrower is unable to repay the loan, the lender may sell the pledged mutual fund units to recover the loan amount. Therefore, investors must carefully consider the risks involved before opting for a loan against a mutual fund.

What are the minimum and maximum required age for availing a loan against a mutual fund?

To avail a loan against mutual funds, an individual must be between 18 to 90 years of age.

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Disclaimer

* Subject to sole discretion of Bajaj Finance Limited and regulatory guidelines.