The most common loan against security is the loan against shares. In a loan against shares you borrow money from the bank and pledge your shares as a security against the money obtained. This type of a loan is called a secured loan.
These shares are merely pledged and not sold and the borrower continues to enjoy the shareholder benefits of these shares such as rights, bonuses and dividends.
Your duly filled loan application form with passport size photograph.
Your Residence and identity proof.
Your last 6 months salary slip for salaried individuals, Certificate and proof of business and income source for self employed professionals and businessmen.
You get a loan against 50% of the value of approved shares and 70% of the value of mutual funds.
You continue to enjoy all ownership benefits of shares and mutual funds such as bonus and dividends.
Interest charged only on loan amount utilized and not the entire loan.
You only pay the interest on the loan each month. Principal repaid at the end of the tenure. Overdraft facility available.
You have to be within the age group of 18-65 years in order to avail a loan against shares.
The tenure of these loans is generally a year but can be extended and taken up for renewal if required.
You can avail a minimum loan amount of INR 1 lakh and a maximum loan amount of INR 10 Lakhs for physical shares and INR 20 Lakhs for demat shares. Banks do not lend against any shares pledged. Only those shares which are on the banks list can be pledged. Each bank has its own list and this is modified periodically.
The RBI allows banks to lend up to 50% of the value of physical shares and 75% of the value of demat shares. Shares held in the names of HUF, minors, Companies and NRI's cannot be pledged.
24 May 2018, Thursday
You have to build an investment portfolio. That’s how your money grows. Be it bonds, equity shares, mutual funds, FDs and so on, there are a number of investments you can make. But, what if your investments can do more than just grow? It is tough to arrange money in an emergency, ...
02 May 2016, Monday
Life is full of emergencies. Your spouse is unwell and has to be hospitalized. This is an emergency which requires money. Your son is studying to be a doctor and the medical fees are in lakhs of rupees. You have to pay his college fees soon and this is an emergency. Most emergencies cost money. So w...
17 November 2014, Monday
With the financial integration both within the country and globally, insurance is increasingly being viewed not just as a ‘stand alone’ product but as an important item on a menu of financial products that helps consumers to blend and create a portfolio of financial assets, manage thei...
18 July 2012, Wednesday
Formalities for a health insurance claim You can make a claim under a Health insurance policy in two ways: On a Cashless basis and A Reimbursement Claim On a Cashless basis: For a claim on cashless basis, your treatment must be only at a network hospital of the Third Party...
14 March 2014, Friday
As the name suggests ELSS invests the whole corpus in equities. Proportions as high as 80-90% of equities are found in an ELSS Fund. It is a special kind of mutual fund that qualifies for tax benefits. Basically Equity Linked Savings Scheme is a mutual fund with a lock in period of three years and...
07 January 2014, Tuesday
One of the most common reason for family feuds in India as in the rest of the World is faulty estate planning. Estate planning is a neglected topic in India mainly because of the emotions attached to it. A common reason people neglect to make a will or indulge in estate planning in their younger yea...