The concept of getting loan against securities is not new. Now a day Mutual funds can be used to take loan.
yes, the loan. You can process the loan online against your mutual funds.There is no need of paperwork. It can be done online just within minutes.
Let’s understand a Digital Loan.
Digital loan means loans without no paperwork, or no wastage of too much time
Now what is a digital loan against Mutual funds?
- A digital loan against mutual fund is a simple process of getting loan against your mutual fund investments Online, without any paperwork. Sounds cool???
- In the Loan against Mutual Fund, you provide your mutual fund units as collateral for the mortgage. The bank keeps the mutual fund units as a security till you pay back the mortgage amount.
- The good thing is that your mutual funds will go on to earn incomes.
- You cannot sell them while you have guaranteed them to the bank.
- This loan allows you the good option as your mutual fund portfolio remains unaffected and earn returns.
- The digital loan takes care of your short-term cash requires.
Why I need it?
- You have a perfect mutual fund portfolio; you have developed it with meticulously and methodically for long term.
- Now the funds are providing good returns as you have expected, but you require some cash for short term duration. You have shortage of money and thinking about to destroy your portfolio which you have prepared after so many efforts.
- In that case no need to take such a forceful step. We have an option– Digital loan against mutual funds.
- This is an excellent option for such a condition when you are in need of cash and you don’t wish to sell your funds.
Precondition:
- Your bank must have a tie up with the mutual fund registrar so it can provide this facility.
- You must have online access to the bank.
- You must have login access to the mutual fund registrar’s portal.
Process:
- Open the website of your bank.
- Now click on ‘loan against mutual funds’.
- Now log in to your net banking account.
- An application form gets occupied with details like customer name, email id and Adhaar Number.
- Then click on the terms and conditions.
- Wait till the process finishes.
- Now login to my CAMS and choose the mutual funds you prefer to guarantee from portfolio- detail of all mutual funds holdings will be there presented on the screen with their current market price.
- Again click on the terms and conditions- these are loan terms and conditions- go through it before clicking.
- If you are qualified for a loan, you required a current account; it isn’t actually complicated to opening up one.
- Now you need OTP and overdraft ready to use in your account.
Key benefits of Digital Loan against Mutual Funds:
- Loan against mutual funds can provide Instant availability of funds in account within minutes.
- Loan against mutual funds is possible against both Debt and Equity Mutual Funds.
- In loan against mutual funds, customer retains mutual funds portfolio without liquidation.
- Loan against mutual funds can be got hold of by the first time borrowers without credit record can access loans.
- In loan against mutual funds, Interest applied alone on amount applied.
- Loan against mutual fund is applicable across the country on various Banks’ sites.
- With loan against mutual funds, new Loans and improvements can be completed online.
How can I use my loan against mutual funds?
It depends on you; you can use your funds any way you like for personal or business needs.