{"id":12971,"date":"2023-08-28T13:03:11","date_gmt":"2023-08-28T13:03:11","guid":{"rendered":"\/blog\/?p=12971"},"modified":"2024-12-17T03:16:34","modified_gmt":"2024-12-16T21:46:34","slug":"loan-against-shares-a-guide","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/loan-on-securities\/loan-against-shares-a-guide\/","title":{"rendered":"Loan against Shares: A Guide"},"content":{"rendered":"\n<p>Market shares are crucial financial\ninstruments, especially in times of unprecedented needs. Faced with a cash\ncrunch, you can easily monetise your investments to procure immediate funds.\nBut instead of liquidating your securities, a loan against shares offers more\nconvenience. <\/p>\n\n\n\n<p>A loan against shares primarily comes under\nthe broader category of loan against securities. Usually available in an\noverdraft facility, you can avail a loan against shares by pledging your shares\nas collateral.<\/p>\n\n\n\n<p>A loan against shares is available for\nthese investments:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Non-Convertible Debentures<\/li>\n\n\n\n<li>Bonds and Government Schemes<\/li>\n\n\n\n<li>Equity\/Demat Shares<\/li>\n\n\n\n<li>Mutual Funds Units<\/li>\n<\/ul>\n\n\n\n<p>Additionally, you can also pledge shares of\nyour blood relatives, including spouse, children, parents, and siblings who are\nabove the age of 18 years. But in such cases, the blood relative needs to act\nas the co-applicant and sign the overdraft agreement. <\/p>\n\n\n\n<p>Here is a comprehensive overview of how\nloan against shares works. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How does the loan work?<\/strong><\/h2>\n\n\n\n<p>In a loan against shares, once you have\npledged your shares, lenders provide an overdraft facility in your bank\naccount. You will have the liberty to withdraw any amount of money from the\naccount, and pay the interest only on the amount and time for which you\nborrowed the amount.<\/p>\n\n\n\n<p>Case in point: suppose you took a loan\namount of Rs. 1 lakh and drew Rs. 80,000 from the account. You took two months\nto return the borrowed amount. In such a scenario, you will only pay interest\nfor two months on the borrowed amount, which is Rs. 80,000. <\/p>\n\n\n\n<p>Moreover, you receive a loan amount based\non the market value of the shares, with a fixed overdraft limit. Nonetheless,\nyou can always increase or decrease liquidity in your account by pledging or\nremoving any additional shares. <\/p>\n\n\n\n<p style=\"color:red\"><strong>Additional Read: <\/strong><a href=\"https:\/\/tata-blog.osian.dev\/blog\/loan-against-securities\/how-does-a-loan-against-security-work\/\">How\nDoes a Loan Against Security Work?<\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>The process from application to disbursement<\/strong><\/h2>\n\n\n\n<p>Interested borrowers can easily apply for a\nloan against shares in two ways, namely online and offline. The eligibility\ncriteria will differ from one lender to another, but most guidelines remain the\nsame.<\/p>\n\n\n\n<p>For loan approval, lenders may ask you to\nfurnish the following documents:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">For salaried and self-employed borrowers<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Address proof<\/li>\n\n\n\n<li>A copy of pan card <\/li>\n\n\n\n<li>Bank statements of the last six months<\/li>\n\n\n\n<li>Salary slips for the previous three months<\/li>\n\n\n\n<li>Income proof (ITR copy of the previous two\nyears)<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">For non-individual borrowers<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Photo identity proof<\/li>\n\n\n\n<li>Address proof (passport\/electricity bill\/others)<\/li>\n\n\n\n<li>Income proof (ITR copy of last two years)<\/li>\n\n\n\n<li>Bank statements <\/li>\n<\/ul>\n\n\n\n<p>Once the documents are verified, lenders\nwill approve and disburse the loan amount. Lenders typically transfer the total\namount within 2-3 days of approval. You will receive access to a current\naccount with an overdraft facility and sanction limit. Free to withdraw any\namount within the limit, you can use either net banking or ATM facilities to\nraise contingent funds whenever needed. <\/p>\n\n\n\n<p style=\"color:red\"><strong>Additional Read: <\/strong><a href=\"https:\/\/tata-blog.osian.dev\/blog\/loan-against-securities\/top-things-to-consider-before-applying-for-a-loan-against-securities\/\">Top\nThings to Consider Before Applying for a Loan Against Securities<\/a><\/p>\n\n\n\n<p>In need of immediate funds? Get a <a href=\"https:\/\/tata-blog.osian.dev\/corporate\/structured-products\/loan-against-securities.html\">loan against securities<\/a> from Tata Capital with no part prepayment or foreclosure charges for repayment convenience. You can quickly secure up to 20 crores within days from application. Benefit from our hassle-free, minimal documentation process and quick turnaround time. For more details, reach out to Tata Capital today!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Market shares are crucial financial instruments, especially in times of unprecedented needs. <\/p>\n<p><a href=\"https:\/\/tata-blog.osian.dev\/blog\/loan-against-securities\/loan-against-shares-a-guide\/\">Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":12972,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[35],"tags":[],"class_list":["post-12971","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-loan-on-securities"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.13 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>A Guide to Loan Against Shares in India - Tata Capital Blog<\/title>\n<meta name=\"description\" content=\"What are\u00a0loan against shares? 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