ICICI Bank has launched a facility that allows its retail customers to get insta loan against mutual funds. You can avail Loan up to Rupees 1 crore against your Holdings in both debt and equity Mutual Fund.
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ICICI Bank Launches Insta Loan against Mutual Funds
From now onwards if you are an ICICI Bank customer and have mutual funds and if you want to take a loan then you can pledge your Mutual Funds to avail this loan as an overdraft in a few seconds.
There is no need to deposit physical documents and you do not have to visit the branch also. This process is completely digital and paperless.
This loan facility is called insta loans against Mutual Fund and this facility is launched in partnership with Computer Age Management Services (CAMS) the country’s leading Registrar and transfer agency of mutual fund.
This instant loan against mutual fund is an extension of insta loan against securities,is a facility in which you can avail loan facility against equity shares. The bank had launched insta loan against securities over a year ago.
The Key features of insta loan against Mutual Funds
- Instant access to funds : if you have a mutual fund unit and you do not want to sell those units but you are in urgent need of money, then you can avail instant loan against your Mutual Funds.
- The loan can be availed against a wide range of debt and equity mutual fund schemes serviced by CAMS and approved by the bank.
- Minimum loan amount is Rs 50,000 for both debt and equity mutual fund scheme and the maximum loan amount is Rs 1 crore.
- You can avail a loan of up to 50% of the (NAV)/net asset value in case of equity Mutual Fund and up to 80% in case of debt Mutual Funds.
- The minimum amount of loan is Rs 50000 while the maximum amount of loan is 20 lac from equity mutual funds and 1 Cr from debt mutual fund units.
Reading https://bestinvestindia.com/mutual-fund-loss/
https://bestinvestindia.com/10-things-to-know-before-investing-in-mutual-funds/
https://bestinvestindia.com/mf-vs-insurance/
https://bestinvestindia.com/mutual-fund-taxation-fy-2019-20/
Are Mutual Funds safe? What is the risk of investing in mutual fund?
Advantage of Overdraft (OD)/Loan against MF
The loan is available in the form of OD. Here like other loans you do not have to pay EMI but you have to pay interest on the limit utilized for the number of days. In other words, you will pay interest for the time you have taken funds from ICICI bank.
FAQs
What if I want to repay fast
There are no foreclosure charges. You have complete flexibility to repay the principal as and when you choose to without any foreclosure charges.
Who can take a loan against Mutual Fund/ Eligibility Conditions
- Equity oriented mutual funds only individuals can apply
( Hindu undivided family, companies, partnership sole proprietors are specifically excluded)
- Debt Mutual Fund/FMP/ ETF: Individuals, companies, partnership firms, and sole proprietors can also apply.
- The loans are granted only against the list of the approved mutual funds as determined by ICICI Bank.
How to apply
The process is completely online. The steps are given to avail instant loan from ICICI Bank against your Mutual Funds
- Login into ICICI Bank Internet banking
- Go to investment and insurance and click on loan against mutual funds
- Select the type of mutual fund that you wish to Mark a lien over
- Confirm request at CMS portal through one-time password OTP authentication
- Through the insta loan terms and conditions and accept the same
- Enter the OTP received and get the loan against mutual fund overdraft account open instantly.
- Lien making is confirmed and the limit will be set in relevant OD loan account
- Start using the funds.
What is the rate of interest and other charges associated with loan against securities?
The rate of interest for equity Mutual Fund is 9.90 % per annum
For debt mutual funds rate of interest is 9.40 % per annum
Additional processing fees Rs 500 Plus Goods and services tax( GST)
Renewal fees Rs 2500 + GST subject to changes.
Where my LAS account be opened to insta loan against mutual funds
The LAS account is opened in the same ICICI Bank branch where you have your existing saving bank account.
You can operate the facility from any of ICICI Bank branches under the anywhere banking facility.
Do I need to have Mutual Funds under ICICI bank code to apply for instant loans against mutual funds?
You can avail insta loan if you have Mutual Funds registered with CAMS irrespective of Under ICICI Bank agent code or not.
What are the operational hours to take insta loan against mutual funds
Insta loan is a complete digital and paperless process.
This facility shall be available from Monday to Sunday 8 a.m. to 7 p.m.
the facility shall not we available on public holidays and bank holidays for Mumbai Maharashtra region as declared by ICICI Bank On its website.
What should I do if insta loan against mutual fund account opening does not go through successfully
You can call LAS first person response (FPR) in case you face any issue while opening the account to insta loan against Mutual Fund. You can apply again after 30 minutes of your post previous attempt.
What is the loan tenure?
The loan tenure is one year and it is renewed on the basis of satisfactory performance of the account after one year.
In case you do not wish to renew the facility you need to place a closure request with the nearest ICICI Bank branch. ( mind it closure procedure is not online).
Which are the approved mutual funds to take the loan?
Please visit the link to get the complete list of mutual funds.
https://www.icicibank.com/managed-assets/docs/personal/loans/list_MF.pdf
Can I process lien removal of mutual funds online?
No, you may visit the nearest ICICI Bank branch for lien removal of mutual fund.
Are there any lien making and lien removal charges?
No, there are no lien making or lien removal charges.
How is the interest in LS account calculated?
Interest is calculated on the daily outstanding balance and is charged on the last working day of the month in the normal course.
How often are the mutual funds revalued?
The MF routine revaluation takes place every Friday.
