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against Mutual Funds

A Loan Against Mutual Funds (LAMF) is a facility that lets you borrow money by pledging your existing mutual fund units as collateral - without selling them. Your investments remain yours, continue to earn market returns, and are unpledged once the loan is fully repaid.

Key highlights:

• 100% digital - no physical paperwork required
• Funds remain invested and continue to grow
• Flexible credit line - withdraw as needed, pay interest only on what you use
• Easy partial repayments of principal at any time

LAMF and Personal Loans serve different needs. LAMF typically offers:

• Lower interest rates (secured by your investments)
• No income proof required
• Minimal documentation
• No impact on your investment portfolio

Personal loans may be more suitable if you do not have eligible mutual fund holdings or need a longer repayment tenure. Please refer to your loan offer and KFS for the specific terms applicable to you.

To be eligible, you must:

• Be an Indian resident individual (Above 18 years of age)
• Hold eligible mutual funds with a minimum combined value of ₹25,000
• Have your PAN and mobile number registered with your RTA (CAMS / KFintech)
• Complete a one-time KYC verification

Generally, the following funds are eligible:

• Equity mutual funds (non-ELSS)
• Debt mutual funds
• Hybrid mutual funds

The following are typically NOT eligible:

• ELSS (Equity Linked Savings Scheme) funds - due to lock-in periods
• Funds held in a Demat account
• Funds not approved under our internal Credit policy

The specific approved fund list may vary. Please check the app or your loan offer for the eligible fund list.

The entire process is 100% digital. You will need:

• PAN (for KYC verification)
• Aadhaar (for e-KYC / Video KYC, if required)
• Bank account details (for disbursal and repayment mandate setup)

No physical documents need to be uploaded or couriered.

The credit limit you are eligible for depends on:

• The type of mutual funds pledged (equity vs. debt vs. hybrid)
• The current market value of your pledged funds (Loan-to-Value or LTV ratio)
• The credit policy of INDcredit and applicable RBI guidelines

Please check the app or your loan offer to see the limit available to you.

LTV (Loan-to-Value) is the percentage of your mutual fund's market value that you can borrow against. Lenders do not lend the full market value to account for market fluctuations that may reduce the collateral's value.

As a general reference, regulatory guidelines currently permit:

• Up to 50% LTV for equity mutual funds
• Up to 80% LTV for debt mutual funds

The exact LTV applicable to your account will be mentioned in your loan offer.

There are no fixed EMIs with LAMF. Here is how repayment works:

• Interest is calculated daily on the outstanding withdrawn amount
• Interest is collected every monthly
• You can repay the principal partially or fully at any time
• Repaying principal increases your available credit limit

There are no penalties for early repayment of principal.

Various fees may be applicable depending on your loan and platform, including but not limited to:

• Processing / withdrawal fee at loan origination or first withdrawal
• Fee for pledging additional funds to enhance your limit
• Bounce / dishonour charges in case of payment failures
• Penal interest for overdue amounts

The exact fee amounts are specific to the platform or LSP through which you have availed the loan. Please refer to your Key Facts Statement (KFS) and loan agreement for the complete fee schedule applicable to you.

📄 You may also visit the Fees & Charges page on the app or lender website for a summary.

Pledging is the process of marking your mutual fund units as collateral for a loan. Here's what it means:

• Your mutual fund units remain in your account - they are not sold or transferred
• A lien is placed on the pledged units, meaning you cannot sell or redeem them during the pledge period
• Your investments continue to earn market returns (NAV appreciation, dividends) during this period
• Once the loan is fully repaid, the lien is released and your units become freely tradable again

The pledging is done digitally through OTP authentication with your RTA (CAMS or KFintech).

If the market value of your pledged mutual funds falls below the minimum required collateral level (due to market movements), a shortfall or margin call situation may arise. In such cases:

• You will be notified via the app / communication channels
• You will be required to either pledge additional funds or repay a portion of the outstanding loan
• If the shortfall is not resolved within the stipulated time, the lender may invoke the collateral (sell the pledged units) to recover the outstanding amount

Please refer to your loan agreement for the specific shortfall management terms.