HDFC Bank is pioneer in the digital lending scenario in India. With products like Insta Loan, Insta Jumbo Loans, HDFC Bank started the trend of paperless personal loans in India which reduced the time to avail a personal loan from a minimum of 3 days to just a few minutes. HDFC Bank was incorporated in 1994 in Mumbai (then Bombay) as Housing Development Finance Corporation and is now the largest private sector lender by assets in India.
HDFC Bank understands the importance of urgent finance needs that anyone may face anytime in life. And with everything going digital, it was __ to bring to lending products online. As such HDFC Bank started paperless pre-approved personal loans to its customers so that they can meet their urgent cash requirements in the times of need. HDFC Bank also provides personal loan against the available balance on the credit cards, which again is paperless and the entire process takes only a few minutes.
HDFC Bank also provides personal loan against securities. This is a very good option for those who invest a major share of their income into investments for the future. In the times of need one can avail a personal loan against their mutual fund holdings instead of selling it.
Digital Loan against Mutual Funds
HDFC in partnership with CAMS, is the first bank to offer Digital Loan against Mutual Funds. Digital here implies that the entire process is completely online and paperless, and one can avail funds in their accounts in just 3 minutes, without having to liquefy their mutual funds.
Features of Digital Loan against Mutual Funds
- Online Loans Against Mutual Funds
Give your mutual fund units as collateral against your loan digitally and get an instant loan approved in just three easy steps. The process is completely automated and paperless.
- High Loan Amount
One can get an online loan worth up to 80% of the value of the mutual funds, the minimum loan amount which one can get is INR 100,000.
- Loan End Use
Loan against Mutual Funds by HDFC is provided only to fulfil personal requirements. The amount borrowed through this cannot be used for any purpose linked to capital market activities, or for any anti-social purposes.
- Easy Repayment Option
One can easily repay the interest along with the principal through monthly instalments. One important thing to know is the interest is calculated only on the amount of the loan actually used by the borrower.
- No Hidden Processing
All the charges are communicated up front to the borrowers, at the time of the processing the loan only. HDFC Bank offers Loan against Mutual Funds without any prepayment and foreclosure charges.
- Quick and Efficient Service
HDFC provides doorstep service and efficient servicing processes. Loans are processed quickly. HDFC Loan against Mutual Funds has a dedicated help desk which helps the customers throughout the process.
- Interest is payable only on Amount Used
When one takes a Loan against Mutual Funds from HDFC, there is no need to worry about paying interest on the entire borrowed amount. Interest is charged only on the actual loan amount which one use. Interest is calculated on the daily outstanding balance.
- Single Scrip Lending Service
One can get up to 50% of the worth with any Depository Participant.
- Quick Application through NetBanking
Customers who have an existing Demat Account with HDFC Bank can easily avail a Loan against Mutual Funds with HDFC through Net Banking. To avail the loan, you just need to log in to the HDFC Net Banking using your Customer ID and IPIN. Go to the Demat Tab, and then click on the Request option which is on the left hand side of the screen. Then click on Loan against Securities, and lastly select the shares that you like to offer as collateral.
- Current Account Benefits
When one opts for a HDFC Bank Loan against Mutual Funds, HDFC creates a current account of that borrower with an overdraft limit. This allows the borrower to enjoy all the facilities and benefits that come with a current account. Along with this one will also have access to features such as net banking and phone banking.
Eligibility for Digital Loan against Mutual Funds
HDFC Bank requires very minimal eligibility criteria for an individual to avail a Loan against Mutual Funds. Still the applicants would need to satisfy the following eligibility criteria to avail the loan:
- Applicants with Indian nationality
- For selected securities, an applicant is eligible for the loan against security if he/she is a member of a Hindu Undivided Family (HUF), and NRI, he/she is an owner of a business, partnership firm, or a private limited company.
Documents Required for HDFC Loan against Mutual Funds
HDFC Loan against Mutual Funds has a paperless online process. Hence one would need to provide the digital copies of the following:
- Identity Proof
- Address Proof
- Signature Proof
- IT returns documents in case you own a business/ partnership, an audited Balance Sheet and Profit & Loss Account statement for the last two years.
Following are considered as valid documents for the purpose of verifying individual identity: PAN Card/Aadhaar Card/Voter ID Card/Driving License/Passport.
Interest Rates of Digital Loan against Mutual Funds
Annual Percentage Rate offered to the customers from January 18 to March 18
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How to apply for HDFC Digital LAMF?
The process of HDFC Digital LAMF is very simple, easy and 100% online. To avail a Loan against Mutual Fund just log into to your CAMS via the net banking portal. Once you are logged in select mutual funds to pledge from your portfolio. After that you will receive an OTP on your registered mobile number. Input the OTP to activate overdraft facility to use in your account.
List of Approved Mutual Funds
To see the complete list of Mutual Fund schemes approved by HDFC Bank to avail a Digital Loan against Mutual Funds, visit this page.