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Loans Against Securities (LAS)

Protecting Your Assets, Powering Your Peace.

What Is a Loans Against Securities (LAS) ?

A Loan Against Securities (LAS) is a credit facility where you can pledge your investments—such as shares, mutual funds, bonds, or insurance policies—as collateral to get instant liquidity without selling them. It allows you to meet financial needs while still enjoying potential returns and ownership of your investments.

Key Features of Loans Against Securities

1. No Need to Sell Your Investments

Continue earning dividends, interest, and capital appreciation while availing a loan.

2. Attractive Interest Rates

Typically lower than personal loan rates, since the loan is secured.

3. Quick Processing

Approvals are fast because the collateral is already liquid and easy to value.

4. Flexible Borrowing

Withdraw funds as needed through an overdraft (OD) or credit line facility.

5. High Loan Value

Depending on the security type, lenders may offer up to 50–80% of the investment value.

Eligible Securities for Loans Against Securities

You can avail a loan against the following:

1. Equity Shares

Listed stocks held in your demat account.

2. Mutual Funds

Both equity and debt mutual funds (depending on lender-approved list).

3. Bonds & Debentures

Government securities, corporate bonds, tax-free bonds, NCDs, etc.

4. ETFs & Sovereign Gold Bonds (SGBs)

Subject to lender guidelines.

5. Life Insurance Policies

Traditional (endowment) policies with surrender value.

How Loans Against Securities Works

  1.  Choose the securities you want to pledge.

  2.  The lender marks a lien on those securities.

  3.  Based on their market value, a drawing power (DP) is assigned.

  4.  You can withdraw funds anytime up to your DP limit.

  5.  Interest is charged only on the amount you use.

  6.  Once the loan is repaid, the lien is removed and securities are released.

Benefits of Loans Against Securities

1. Retain Ownership

You do not liquidate investments; you continue benefiting from market growth and returns.

2. Cost-Effective Credit

Lower interest rates compared to personal loans or credit card borrowing.

3. Flexible Usage

Funds can be used for business, emergencies, education, travel, or any personal need (except speculation).

4. Pay Interest Only on Utilized Amount

Interest is calculated only on the amount you withdraw from the sanctioned limit.

5. No Foreclosure Charges

Most lenders allow early repayment without penalties.

Risk Factors to Consider

1. Market Fluctuations

If the value of your pledged securities falls, lenders may issue a margin call asking you to pledge more or repay part of the loan.

2. Limited Credit for Volatile Assets

Equity shares and equity mutual funds generally get lower loan-to-value ratios.

3. Lender’s Approved List

Not all securities may be eligible; approval depends on the lender.

Loan-to-Value (LTV) Expectations

Typical LTV ratios (may vary by lender):

Security Type Approx. LTV
Equity Shares 40–50%
Equity Mutual Funds 40–50%
Debt Mutual Funds 70–80%
Bonds/NCDs 60–75%
Insurance Policies 70–80%

Who Should Consider LAS?

  • Investors needing short-term liquidity without selling assets

  • Business owners requiring working capital

  • Individuals planning large expenses (education, medical, travel)

  • Traders/investors needing temporary cash flow without exiting markets

  • Anyone holding large investments who wants cheaper credit options

A Loan Against Securities is a smart, efficient, and economical way to access funds without disturbing your long-term wealth-building strategy. It offers quick liquidity, flexible usage, and lower borrowing costs—making it a preferred choice for investors and professionals alike.

Investment Solution

  • Mutual Funds & SIP

    A Mutual Fund is an investment vehicle that pools money from multiple investors and invests it in a diversified portfolio of assets such as equities

  • Fixed Deposit & Corporate FD’s

    Fixed Deposits (FDs) have long been a preferred choice for conservative investors seeking assured returns and capital protection. Offered by banks and NBFCs, FDs allow you to deposit

  • Bonds / NCD

    Bonds are fixed-income instruments issued by governments or companies to raise capital, paying periodic interest and returning principal at maturity.

  • Government Bonds & Debt Instruments

    In today’s unpredictable market landscape, many investors look for avenues that offer stability, regular income, and capital preservation.

Insurance

  • Life Insurance

    Life insurance is a financial protection plan that ensures your loved ones remain financially secure in case of your untimely demise.

  • Health Insurance

    Health insurance provides financial protection against medical expenses due to illnesses, accidents, and hospitalization. Even if you are healthy today, medical emergencies can arise at any time.

  • General Insurance

    General Insurance provides financial protection against non-life risks such as accidents, health emergencies, property damage, theft, or liability.

Loans

  • Loans Against Security

    A Loan Against Security is a credit facility where you pledge your financial investments—such as mutual funds, shares, bonds, insurance policies, or fixed deposits

  • Loans Against Mutual Funds

    At Wealthmart Global, our Loans Against Securities (LAS) solution empowers you to access funds without having to liquidate your long-term investments.

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