Loan Against Mutual funds
Liquidity Without Breaking Your Investments
Need funds but don’t want to sell your mutual fund investments?
With a Loan Against Mutual Funds (LAMF), you can unlock liquidity while your investments stay intact. This allows you to meet short-term needs without disrupting your long-term wealth plan.
At Steadrow Capitals, we help you access loans against your mutual fund holdings at interest rates starting from 10.3% per annum, through a simple and fully digital process.
Why Choose Loan Against Mutual Funds?
Selling mutual funds can:
- Break long-term compounding
- Trigger capital gains tax
- Force you to exit at the wrong market time
A loan against mutual funds lets you borrow instead of selling, so your investments continue to stay invested and potentially grow.
How It Works – A Simple Illustration
You hold mutual funds worth ₹20 lakh.
Instead of redeeming them:
- You pledge the units digitally
- Receive a loan against their value
- Continue to remain the owner of the funds
Once the loan is repaid, the pledge is removed, your investments remain untouched.
Key Benefits
- Interest rates starting from 10.3% p.a.
- 100% paperless and digital process
- No need to sell mutual fund units
- Faster access to funds
- No impact on long-term investment strategy
- Units remain in your demat / folio, only pledged
When Does This Make Sense?
Loan against mutual funds is useful when:
- You need short-term liquidity
- You don’t want to disturb long-term investments
- You want to avoid unnecessary tax outflow
- You expect cash inflows in the near future
- You want a flexible borrowing option
In Summary
A Loan Against Mutual Funds is a smart liquidity solution for investors who want access to funds without compromising long-term wealth creation.
It combines convenience, speed, and efficiency, all while keeping your investments working for you.
How Steadrow Capitals Helps
We help you:
- Evaluate if a loan against mutual funds suits your need
- Access competitive interest rates
- Complete the entire process digitally and smoothly
- Structure borrowing without harming your financial plan
If you need liquidity but want your investments to stay invested, a loan against mutual funds can be the right solution.
FAQs
Do my mutual funds continue to earn returns while they are pledged?
Yes. Because you are only pledging your units as collateral and not selling them, your money remains fully invested in the market. You continue to benefit from market growth, dividend payouts, and the power of long-term compounding.
How is the interest calculated and charged?
The interest is typically calculated only on the exact loan amount you utilize and for the specific number of days you use it. This makes it a much more flexible and cost-effective borrowing option compared to traditional personal loans.
Will taking this loan trigger any capital gains tax?
No. Redeeming your mutual funds forces a taxable event (Short-Term or Long-Term Capital Gains tax). However, pledging your funds for a loan is a completely tax-free transaction. You get the liquidity you need without unnecessary tax outflows.
How long does it take to get the funds?
Because Steadrow Capitals facilitates a 100% paperless and digital process, the turnaround time is incredibly fast. Once your mutual fund units are digitally pledged, you get much faster access to your funds compared to standard bank loan approvals.
Do I need to visit the office to sign loan documents?
Not at all. While our doors in Dharamshala are always open for face-to-face guidance, the entire Loan Against Mutual Funds process is fully digital. Whether you are in Kangra or anywhere else in India, we manage the KYC, pledging, and execution securely online.