Now customers will be able to take loan against mutual funds also. Tata Capital on Tuesday launched a new scheme named ‘Loan Against Mutual Fund’. Under this, customers can take loans on mutual funds ranging from Rs 5 lakh to Rs 2 crore. This is the first time in the mutual fund industry that someone has launched such a digital loan scheme. Tata Capital is a Tata group company that provides financial services.
The company said that this digital loan can be taken on all mutual fund schemes investing in equity and debt. Customers can take this loan by pledging their mutual fund units deposited in different mutual fund companies. The “Loan Against Mutual Fund” scheme is designed keeping in mind all types of customers, meeting their varied needs from the fund. The loan amount will depend on the amount and for how long the customer’s mutual fund folio is deposited. The ownership of this mutual fund unit will be transferred to Tata Capital at the time of loan, which will be returned to the customer after repayment of the loan.
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According to a report by AMFI, an association of mutual fund companies, the asset under management of the Indian mutual fund industry stood at Rs 15.18 lakh crore as on July 31, 2016, which increased to Rs 35.32 lakh crore as on July 31, 2021. This means that till July 31, 2020, various institutions and the general public together have invested Rs 35.32 lakh crore in the mutual fund industry.
Loan Against Mutual Funds can prove to be a good scheme to meet the personal and business related needs of the customers. The special thing is that even after the loan, the mutual fund portfolio of the customer will remain and he will continue to get the other benefits associated with it.
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Key Benefits of Loan Against Mutual Funds
No need to go to the office. The entire process is online from loan application to transfer of money to the account.
The loan can be taken as an overdraft facility or as a term loan.
– Auto-renewal facility for tenors of more than one year (depending on review of mutual fund portfolio)
– Process of Hold on Mutual Funds Unit also completely online through CAMS API.
The customer will continue to get the facility of dividend and growth of his mutual fund portfolio.
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