What is a Loan Against MF?
A Loan Against Mutual Funds (LAMF) allows you to pledge your mutual fund units as collateral to obtain a loan from a bank or NBFC. You get access to funds without redeeming your investments, so your wealth continues to grow uninterrupted.
💡 This is a smarter alternative to redeeming investments in an emergency. You avoid exit loads, capital gains tax, and the loss of future compounding returns.
Key Benefits
No Redemption Required
Your mutual fund units stay invested and continue to earn returns while you use the loan amount.
Quick Processing
Loan can be disbursed within 24–48 hours of pledge confirmation.
Lower Interest Rate
Typically 9–11% p.a. compared to 14–24% for personal loans.
Flexible Repayment
Overdraft facility — pay interest only on the amount you actually use.
High Loan Value
Get 50–80% of the net asset value (NAV) of your pledged units.
No Prepayment Penalty
Repay anytime without any prepayment charges.
Eligibility
- You must be an existing mutual fund investor
- Units must be held in demat format (or under specific AMC arrangements)
- Eligible fund categories: Most equity and debt mutual funds (except ELSS and liquid funds)
- Minimum loan amount: ₹25,000 (varies by lender)
How It Works
Share your mutual fund portfolio details with us
We evaluate eligible units and calculate your loan eligibility
Apply with the lending partner (bank or NBFC)
Pledge units online through CAMS / KFintech
Loan disbursed to your bank account
Repay and get pledge released — units revert to your account
Frequently Asked Questions
Do I still earn returns on pledged units?
Yes. Your units remain in your account and continue to earn returns. You only pledge them as collateral.
What happens if I cannot repay?
If you default, the lender may redeem your pledged units to recover the outstanding amount. This triggers capital gains tax.
Need Funds Without Selling Investments?
We can help you arrange a Loan Against Mutual Funds quickly and conveniently.
