Loan Against Shares, Mutual Funds, Bonds and Debentures

LAS stands for "Loan against security”. Securities include equity shares, mutual funds units (both equity and debt), etc. A loan against security is provided after the bank’s approval and verification.

A loan against shares is applying for a loan by pledging one's securities in the favour of a bank.

Yes, a loan against securities is a good option as you can avail yourself of cash without selling your securities. Additionally, the repayment process is quite transparent and easy.

It varies as per your CIBIL score.

Yes, you can avail loan against shares, if you hold shares that are as per the bank’s approved list.

For more details, contact the Bank of Baroda branch in your vicinity.

You can avail maximum loan of Rs. 20 lakhs against shares, providing the shares are in DEMAT form and are included in our approved list.

A loan against security is not provided for investment purposes. It is solely provided to meet the contingency needs.

A loan against security can be availed by a customer for meeting personal/contingency needs.

The client must approach any Bank of Baroda branch. The branch will check the securities available with you, and accordingly inform them about the limit which can be granted as per the market value of the security.

If you have the equity shares, first you need to pledge the securities in the bank's loan against the security DEMAT account.

CDSL 1301870000469054, NSDL IN30087010471981, branch will take other relevant documents along with PMR & for them to the corporate office for further processing.

In the case of mutual funds, the customer will have to submit consent in investor letter format and submit it to the concerned branch which in turn will forward it to the corporate office for further processing.

1. Any individual (resident & non-resident), including staff members engaged in the gainful activity, who have a regular source of income can apply for a loan against securities (LAS).  
 
 2. Two or more individuals
 a. The securities can be held in any by one or more applicants. In the case of a joint account, the name of all the holders must be of the applicant or co-applicant.  

 b. If the co-applicant is not the leader of security, he/she should be a close relative of the holder.  
 c. At least one applicant-applicant should be engaged in the gainful activity and have a regular source of income.
 d. The total outstanding per individual should not cross the limits mentioned under ticket size from the entire banking system.
 
 Note:  

a. Applicants can have a DEMAT account with any depository participants.  
 b. List of close relatives: spouse, father, mother (including stepmother), son (including step-soon), son’s wife, daughter (including step-daughter),  
 daughter’s husband, brother/sister (including stepbrother/sister), brother’s  
 wife, sister (including stepsister) of spouse, sister’s husband, brother (including stepbrother) of a spouse.

It ranges from 21-70 years.

A loan against sovereign gold bonds is available, providing Sovereign Gold Bond (SGB) is listed and in the DEMAT form.

The minimum limit is Rs. 1 lakh and the maximum learned is Rs. 5 crores.

For equity share res. The maximum limit is Rs. 20 lakhs; for mutual funds (equity) maximum limit is Rs. 10 lakhs. If mutual funds (equity) are in DEMAT form, then a maximum of Rs. 20 lakhs can be granted.

The margin loan against equity shares & equity funds is 50%. Whereas the margin in loans against debt securities is 25%.

The loan is granted for 12 months. It can be extended further after satisfactory conduct post review.

Yes, if the borrower settles the overdue before 12 months, the loan account will be closed.

If all the documentation part is done and the securities are lien marked pledged, the loan will be disbursed within 2-3 working days.

If anyone needs funds to meet their contingency needs, without selling their mutual funds units, then they can avail loan against a mutual fund.

Have a look at the list below.

1. For equity MF in DEMAT – Rs. 20 lakhs
2. For equity MF in Non-DEMAT accounts – Rs. 10 lakhs

For debt MF – the maximum limit of Rs. 5 crores.

One's daily drawing power will be pushed based on the market value of the mutual fund, keeping the margin aside.

Please visit the nearest Bank of Baroda Branch or take a loan against mutual funds online.
(embed “online” with the link of the page)

Yes, mutual fund units held by you can be used as collateral.

Yes, the Bank of Baroda provides loans on debentures and bonds in DEMAT form.

Debentures are an asset to the customer.

For a loan to be granted the script has to be an under banked-approved list of securities.

For a mutual fund to qualify, funds have to be 1 year old with 100 crores AUM.

If the market value of the securities goes down, automated e-mails will be triggered to your registered mail ID. Then, you will have to pay a margin amount or pledge additional security.

In another case, if the market value of securities goes up, you can ask for a limit increase under the maximum limit purview.

Yes, it is a mandatory requirement.

The limit will be given in form of an overdraft facility only.

Yes, the facility is extended to NRIs as well.

Unified processing charges are 0.35% of the amount sanctioned.
For detailed charges, you can  visit – Service Charges Pages

In case of corporate action of any bonus issue, the new shares/ unit of mutual funds will be pledged, and the borrower may request an additional limit or withdrawal of pledge on these shares, provided margin/exposure norms are complied with as of the date of such request.

Yes, a loan against security can be granted, but the wife has to be a joint holder.

Yes, partial withdrawal of securities is allowed provided sufficient margin is available even after the release of securities that have been requested by you.

The bank will never sell the securities without informing you.

You will be given some pre-defined timelines based on LTV up to which you can normalize your account by paying margin/pledging additional securities.