HDFC is one of the leading banks in the arena of private banks in India. It came into being in August 1994 as the result of liberalisation of India economy which is the biggest ever milestone for Indian economy till date. Ever since then HDFC, also known as Housing Development Finance Corporation has established itself as a dependable bank that caters for all banking needs serving not only big corporations but also the common man. It has 4541 branches spread across 2587 cities which are linked on real time basis. These statistics make HDFC a bank with one of the most efficiently connected and supremely accessible financial institutions. HDFC understand the importance of technology and in today’s world the security threats. This is why they work on state-of art platform that not only ensures efficient and speedy operations but also safety and privacy of their clients’ information and wealth.
Making your securities work for you
HDFC’s loan against securities works by mantra of “Get loan against your securities without selling them!” and this is what makes this product from HDFC very attractive. One can raise loan against the portfolio of approved list of securities that are as follows:
- National Savings Certificates (NSC)
- Mutual funds including equity, debt and FMP’s: In case of this security, maximum 50% of the total Net Asset value is extended as loan to the applicant. In case of a portfolio, share of single scrip should not exceed 65% of the total.
- Kisan Vikas Patra
- Gold Deposit certificates
- Live Insurance policies issues by LIC as well as selected private companies
- NABARD’s Bhavishya Nirman bonds
- Non-Convertible debentures
HDFC ensures complete transparency in its dealings and all loan charges, direct and indirect are clearly mentioned in the loan document and disclosed upfront before the loan is availed. The main features of this type of loan are as follows:
- Scan-based account opening is available for this loan.
- A current account for disbursal of this loan will be opened in favour of the borrower and shall carry all benefits and facilities that come with having a current account with HDFC.
- One can withdraw loan through overdraft facility which simple means drawing over and above the existing or available balance. It will show as a minus balance in the account statement. This also means that you are charged only for the loan withdrawn on daily outstanding basis, even if loan sanctioned is for an upper limit.
- The loan withdrawal and access to loan is available from anywhere and anytime through internet banking.
- 1%-2% prepayment charges are levied for pre-closure of loan. Pre-closure is not allowed for the first 8 months of taking the loan.
- Dedicated helpdesk for loans against securities for speedy resolution of doubts and issues
- One can apply online for this loan
- Minimum amount of loan under this scheme is INR 1 lac and maximum Rs. 20 lakhs.
- In case the DEMAT Account is jointly held, then approval of all holders will be required for the loan.
- Minimum documentation and doorstep service is available for this loan which results in faster loan disbursal.
- Applicant can pledge shared from any depository or depository participant in India which means that having a DEMAT account in HDFC is not a mandatory condition for this loan.
- In case the securities are disposed off in case of default then all charges like brokerages, processing charges and transaction charges shall be borne by the borrower based on actual.
- This opportunity is also available for Non-Resident Indians.
- The loan is not to be used for any speculative activities or for investment in capital markets.
Following securities are not eligible for this loan:
- Partially paid up securities of a company where the applicant is a director or promoter of such company
- Securities in name of trusts or minor
Apart from the list of eligible securities as mentioned in the paragraphs above, the eligibility criteria for applying for this loan is that the applicant should be an Indian resident with 18 years or above age. Members of Hindu Undivided family, owner of sole proprietorship, partnership firm, private limited company and NRIs are also eligible for this loan against certain selected securities only.
HDFC’s customers who are resident Indians can apply for these loans against securities through net banking if they hold DEMAT account with HDFC.
An applicant needs to submit the following documents while applying for this loan:
- Identity proof- PAN Card, Aadhaar card, voter’s id etc
- Signature proof
- Address proof: Aadhaar Card, voter’s id, electricity bill and other approved utility bills.
- Applicants from companies, partnership or proprietorship need to submit audited Balance sheet, profit & loss account of past two financial years.
These were the important features and points related HDFC Loan against securities. It is a great way of making your securities work for you without parting with them. You can apply for this loan through www.letzbank.com because on our portal you can compare the offers from other lenders too and we give this service to you absolutely free of cost!