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Axis Bank Loan Against Mutual Fund

Highlights

  • What makes one choose Axis Bank when it comes to a loan against mutual fund units?
  • Lower interest rates and greater loan eligibility encourage one to do so

Mutual funds are mainly invested with a purpose to build wealth for the future. But come the emergencies, most sell their mutual fund units to get the sum needed to overcome contingencies.Your future goals get compromised to a degree in doing so. But not when you get the loan against a mutual fund from Axis Bank, a reputed private sector bank with around 4,000 branches across India. The loan is available against both equity and debt mutual funds and in impressive amounts. So what are you waiting for? Read on to know more about the loan offer.

Axis Bank Loan Against Mutual Fund Interest Rates & Other Details

ParticularsDetails
Interest Rate10.50%-12.75% Per Annum
Loan EligibilityUpto 60% of the NAV if granted against equity mutual funds

Upto 85% of the NAV if granted against debt mutual funds
Processing Fee0.15% of the sanctioned amount or INR 1,000,, whichever is higher, plus GST
Renewal ChargesINR 1,000 plus GST (Equity Mutual Funds)

0.10% of the sanctioned amount or INR 5,000, whichever is lower
Prepayment ChargesNIL

Note – The Net Asset Value (NAV) is the price of a mutual fund and remains different from one trading day to another depending on the market movement.

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Key Takeaways

  • Attractive Interest Rates – The interest rates offered on the loan are impressive and remain quite competitive given the times we are in. While the lowest rate is just a shade above 10%, the highest rate is not far from the lowest. This makes it an attractive option for borrowers who can save a lot on their interest outgo using this Axis Bank loan facility.
  • Higher Loan Eligibility – While most lenders keep the maximum loan eligibility to 50% of the NAV in case of equity and 80% in debt funds, Axis Bank offers upto 60% (Equity) and 85% (Debt).
  • Zero Prepayment Charges – You may get a big fat sum while servicing the loan. So, you can pay out the loan with the same without having to incur any prepayment charges.

How Does Axis Bank Disburse Loan Against Mutual Fund?

Axis Bank will grant an overdraft facility when you ask for a loan against mutual fund units. Do you know how many mutual funds will get pledged for the loan purpose? The calculation of units will be made by dividing the sanctioned amount by the prevailing NAV at the time of disbursal. So, if the sanctioned amount equals INR 5 lakh and the NAV of your mutual fund is 150, around 3,333 units will be pledged. The bank will open a separate current account wherein the money will be disbursed. The interest will accrue only on the utilized amount. You can service the interest payment by crediting your current account.

Eligibility Criteria

  • Resident Indians and non-resident Indians (NRIs) aged above 18 years can apply for the loan
  • Sole proprietorship, partnership firms and private limited companies are also eligible to apply
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Documents Required for Axis Bank Loan Against Mutual Fund Units

Submit the following documents while applying for the loan against mutual funds at Axis Bank.

  • Identity Proof – PAN Card/Voter ID/Driving License/Passport
  • Residence Proof – Voter ID/Driving License/Passport/Aadhaar Card
  • Latest mutual fund account statement
  • Pledge form
  • Guarantor Form (Mandatory in case of joint holding else it will be optional)

How to Apply for Axis Bank Loan Against Mutual Fund?

You can apply for the same on the official website of Axis Bank. Below are the steps that can help you apply.

  • Go to ‘Explore Products’ and then on to ‘Loans’
  • There, you will see the option of ‘Loan Against Securities’
  • Click on the same and enter details such as your name, mobile number, email address, residence address, etc
  • Click on ‘Submit’ to get to the next stage where you’ll need to enter mutual fund details’’
  • Submit the application after mentioning the details correctly

The bank will go through your application and give an in-principle approval on finding the details true to the case. Subsequently, an executive will come to your home or office to pick up your documents. Hand over the same to the concerned executive so that the bank can process the application for final approval.

As opposed to when you will apply at the branch, you should ask the concerned official to give you a loan against the mutual fund application form. Enter the details correctly and submit the form along with necessary documents to the concerned bank official who will then process your application. If the details are found true, you will be approved a loan.

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How Can You Raise Queries Regarding Axis Bank Loan Against Mutual Funds?

Doesn’t matter whether it’s about the loan eligibility or interest rates, you can dial the phone banking numbers – 18604195555 or 18605005555 – to get all solved. The representatives will be available from Monday to Saturday (9 a.m. to 9 p.m.). They will hear your queries patiently and resolve them at the earliest.

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