Loan Against Securities (LAS) in Tamil Nadu — Complete Guide
Loan Against Securities (LAS) lets you borrow against shares, mutual funds, bonds, or other approved holdings in your demat account — without selling them. The lender marks a lien on pledged units and offers a limit or term loan based on portfolio value.
LAS suits investors who believe their portfolio will recover or grow, but need cash now for business, property, or personal use. Market risk applies — if values fall, the lender may ask for additional collateral or partial repayment.
Who Can Apply?
- Individuals with active demat and trading accounts
- Portfolio of approved stocks or mutual fund schemes
- Minimum portfolio value per lender (often ₹5 lakh+)
- Resident Indians; rules differ for NRI portfolios
Documents Usually Required
- PAN, Aadhaar, and demat account statement
- Pledge request form (POA or digital pledge via depository)
- Income proof for higher limits
- List of scrips — only lender-approved securities qualify
What Problem Does It Solve?
Selling investments during a market dip locks in losses. LAS provides liquidity while you stay invested — useful for HNIs, professionals, and business owners with equity holdings who face a temporary cash need.
Common Uses for LAS
How Tamil Nadu investors and professionals use securities-backed credit.
Fund Without Liquidating Portfolio
Inject capital into your business or partnership when you expect equity markets to recover — avoid timing the market by forced share sales.
Flexible Revolving Credit
Many LAS products work as overdraft — pay interest only on amount used. Draw and repay as needed within the approved limit linked to portfolio value.
Bridge Until Sale or Bonus
Arrange down payment or registration charges for property while waiting for bonus, ESOP exercise, or mutual fund redemption settlement.
Large One-Time Payments
Cover advance tax, education fees, or medical bills without disrupting long-term investment allocation — repay when cash inflows arrive.
LAS — Frequently Asked Questions
What is LTV on shares and mutual funds?
Lenders lend a percentage of eligible portfolio value — e.g. 50% on equity shares and 60–70% on liquid mutual funds. Penny stocks and unapproved scrips are excluded. LTV is reviewed periodically.
What is a margin call?
If market fall reduces portfolio value below required security cover, the lender issues a margin call — you must pledge more securities or repay part of the loan within a short window. Ignoring it can trigger liquidation of pledged units.
LAS vs personal loan — which is cheaper?
LAS interest often starts lower (10–13%) because securities collateralise the loan. Personal loans may be faster for non-investors but carry higher unsecured rates. LAS requires demat setup and market awareness.
Can I still receive dividends on pledged shares?
Yes — dividends and corporate actions usually flow to you, but terms vary. Read the pledge agreement. Voting rights may be restricted during pledge period.
How do I release pledged securities?
Repay the outstanding amount (full or partial per lender rules). The lender instructs the depository to remove the lien; units become free in your demat within a few working days.
Ready to Apply for LAS?
Select Loan Against Securities on our application form. We will connect you with lenders offering LAS on approved demat holdings.
Typical WhatsApp reply within 2 hours (Mon–Sat, 9 AM–7 PM IST)
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