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LAMF - Loan Against Mutual Funds

Need Funds ? Avail a loan against your mutual funds instead of selling them.

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    Avail a loan against approved Equity and Debt Mutual Funds that are registered with CAMS (Computer Age Management Services)

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    High LTV ratio

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    Overdraft facility

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    Pay interest only on the loan amount and duration

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    Flexible repayment

Loan Against Mutual fund Loan Against Mutual fund

Reason To Choose ICICI Bank For Loan Against Mutual Funds

Loan Value

Loan Value

In case of Equity Mutual Funds, loan up to 50% of the Net Asset Value (NAV) with a maximum limit of Rs. 20 lakh and in case of Debt Mutual Funds, up to 80% with no maximum limit, can be availed.

Exclusive facility

Exclusive facility

The facility is available exclusively for select ICICI Bank account holders having Mutual Fund holdings in individual capacity.

Long-term retention

Long-term retention

Long-term retention of Mutual Funds portfolio without liquidation.

Interest rate

Interest rate

Interest is charged only on the utilised amount and for the utilised time period.

Disbursement

Disbursement

End-to-end paperless disbursement.

Loan Amount

Loan Amount

Maximum loan of Rs. 20 lakh and Rs. 1 crore can be availed for Equity and Debt Mutual Funds respectively.

Steps to Apply for Insta Loan
Against Mutual Funds

  • Internet Banking
  • iMobile
  • 01. Login to Internet Banking
  • 02. Click on ‘Cards & Loans’, then go to ‘Loans’ and select ‘Loan Against Mutual Funds’
  • 03. Select the type of Mutual Fund for lien marking
  • 04. Enter additional information and provide FATCA* details
  • 05. Calculate your final loan amount
  • 06. Access funds through your new Overdraft Account.
Loan Against Mutual Fund through Internet Banking
  • 01. Login to the iMobile
  • 02. Go to ‘Pre-approved Loans/Offers’ and select ‘Loan Against Mutual Funds’
  • 03. Select the type of Mutual Fund for lien marking
  • 04. Enter additional information and provide FATCA* details
  • 05. Calculate your final loan amount
  • 06. Access funds through your new Overdraft Account
Loan Against Mutual Fund through IMobile

Advantages of Loan Against Mutual Funds

Here are a few advantages of availing a Loan Against Mutual Funds:

  • High Loan to Value (LTV) ratio: If you borrow a loan against Equity Mutual Funds, you may obtain up to 50% of the net asset value as a limit. With Debt Mutual Funds, this limit increases up to 80%

  • Convenient and easy access to funds: One of the biggest advantages of availing a Loan against Mutual Funds is the convenience and easy access to funds. You can instantly pledge your Mutual Fund units to activate the Overdraft facility and withdraw the required funding in no time, subject to eligibility

  • Low-interest payment: The interest rate on these loans is competitive, significantly reducing the interest amount and the total loan cost. Since it is an Overdraft facility, you pay interest only on the limit utilised and for the number of days it is utilised

  • No fund liquidation required: One of the biggest advantages of borrowing a Loan Against Securities (LAS) is that you don’t need to liquidate your Mutual Fund investments. You can avail an Overdraft facility against the Mutual Fund units, while staying invested in them for long term

  • Capital appreciation: Investors opting for LAS can enjoy capital appreciation of Mutual Funds while pledging it for loans

  • Flexible repayment: The flexible repayment terms allow you to customise the repayment schedule according to your budget and available liquidity

Eligibility Criteria and Documents Required

Eligibility criteria and documents required

You must fulfil the following eligibility conditions to apply for a Loan against Mutual Funds:

  • You must be minimum 18 and a maximum of 75 years of age

  • You should have a valid e-mail ID and mobile number

  • Only individual customers are eligible to apply for equity-oriented funds. HUFs, companies, sole proprietors and partnerships do not qualify

  • For Debt Fund Individuals, HUFs, companies, sole proprietors and partnerships may apply

  • The final loan sanctioned depends on the list of approved Mutual Funds and credit assessment of the borrowers.

If you are eligible for a Loan against Mutual Funds and choose to proceed through the offline process, you must provide the following documents to verify your information:

  • Photograph

  • Address proof (Aadhaar Card/Passport/Driving License/Voter ID)

  • Identity proof (Aadhaar Card/Passport/Driving License/Voter ID)

  • PAN Card

  • Signature verification (PAN Card/Passport/Banker's verification)

  • Original Mutual Fund statements/Demat holding statement

  • Bank cheque

  • For non-individual customers, the standard KYC documents for an Overdraft/Current Account opening may be required. Please click here.

  • Additionally, we may require an audited balance sheet, Net Worth Certificate and profit and loss accounts etc., as per the credit requirement.

If you are eligible for our pre-approved Insta Loan Against Mutual Funds and choose to proceed through the digital process, you can avail the facility through our Retail Internet Banking site or the iMobile app without any documentation, just by fulfilling the below criteria:

  • Pre-approved eligibility for Insta Loan Against Mutual Funds

  • Registered e-mail/mobile with Computer Age Management Services (CAMS)*

  • Mutual Funds should be included under ICICI Bank’s approved list of Mutual Funds.

*CAMS (Computer Age Management Services) is a Mutual Fund transfer agency serving Indian Asset Management Companies.

Interest rates and charges

Interest rates and charges

For Loan Against Securities, like Mutual Funds, you get an Overdraft facility up to a certain amount. You can withdraw the funds as required and pay interest only for the amount utilised. The interest calculation takes place daily and is debited to the Current Account at the end of each month. Here is an overview of the applicable interest rates and charges:

Description Charges

Processing charges (Non-Refundable)

Up to 2% of the borrowed amount

Renewal charge (Non-Refundable)

₹ 2,500 per annum at renewal (plus GST)

Sale of Securities (Upon the customer’s request)

₹ 5,000 plus taxes and brokerage

Penal charges for payment delay or default

5% of the withdrawn amount per annum (plus taxes).

Loan Against Mutual Funds FAQs

What is the tenure of a Loan Against Mutual Funds?

The ICICI Bank Insta Loan Against Mutual Funds (MF) provides a loan repayment tenure of one year with the option for renewal based on the performance of the account after the initial year. You can contact the Bank for more details.

Which funds are accepted under a Loan Against Mutual Funds?

The Mutual Funds present in the Approved list of Mutual Funds are accepted.

What is the interest payment cycle for a Loan Against Mutual Funds?

The interest calculation takes place daily and is debited to the Current Account at the end of each month. Here is an overview of the applicable interest rates and charges:

Description

Charges

Processing Charges (Non-Refundable)

Up to 2% of the borrowed amount

Renewal Charge (Non-Refundable)

₹ 2,500 per annum at renewal (plus GST)

Sale of Securities (Upon the customer’s request)

₹ 5,000 plus taxes and brokerage

Penal charges for payment delay or default

5% of the withdrawn amount per annum (plus taxes).



When will I receive the funds after applying for a Loan Against Mutual Funds?

Once your loan is sanctioned and the Mutual Funds are lien marked/pledged in favour of the Bank, the credit limit will be set in your Overdraft Account which you can start using.

What happens when my Mutual Fund price drops?

If your Mutual Fund price drops then your overall credit limit may decrease, which in some cases may lead to your account becoming overdrawn in case your outstanding balance becomes more than the revised credit limit. In that case, you can either lien/pledge more Mutual Fund units which will increase your credit limit or repay the excess amount that you have withdrawn to regularise the account. Please note that penal charges may be applicable on the overdrawn amount till the account is regularised.

When can I release my Mutual Funds?

You can release your Mutual Funds after repaying the amount which is due to the Bank or if you have a surplus limit available in your account which allows the Mutual Funds to be released.

Can we take a loan by pledging shares?

Yes, you can take a loan by pledging shares with ICICI Bank, which are part of the approved list for loan purposes. Approved list of shares

Is it possible to make a part prepayment/foreclosure before the end of the loan tenure?

Yes, you can make a part prepayment of the amount utilised from the limit anytime, without incurring any charges.

Can I swap/change shares during my loan tenure?

Yes, you can swap your pledged shares anytime with other shares which are part of the approved list for loan purposes.

How frequently does the price of my shares get updated in my loan account?

The routine revaluation takes place every Friday. However, a revaluation can also take place in the interim period if there is a significant fluctuation in the market or if the Bank deems it is fit to do so.

What is the frequency of interest payments?

Interest is calculated on the daily outstanding balance and will be debited/charged to the LAS Account on the 2nd working day of every month for the entire interest period.

Is my interest applicable to the entire loan limit?

Since it is an Overdraft facility, the interest is applicable only on the limit utilised and for the number of days it is utilised.

What is the interest payment cycle for a Loan against Shares?

Interest is calculated on the daily outstanding balance and will be debited/charged to the LAS Account on the 2nd day of every month for the entire interest period.