Below is the broad process flow for availing Digital Loan Against Mutual Funds:
1. Click on Digital LAMF link: https://apply.hdfcbank.com/dapweb/las
2. Enter Customer ID, mobile number & captcha
3. Authenticate yourself using existing NetBanking Customer Id and password
4. Fill the online application. Please remember to enter Shadow LG Code 318325 to get the best rate of interest available.
5. Post which, you will be directed to MyCAMS site. Log in to MyCAMs, selects funds to be lien marked and validates basis OTP sent on your registered mobile number.
6. Post selection of MFs, MyCAMs redirects to HDFC Bank along with the fund details chosen by you.
7. Eligible limits are calculated and displayed basis the MFs chosen.
8. Reads and accept necessary Terms & Conditions for the loan limit setting and current account opening.
9. OTP sent for second level authentication on registered mobile number.
10. Thank you message displayed – MFs lien marking completed, Current Account will be opened and overdraft limit will be set in the Account which is available instantly for use.
Do I get my entire mutual fund value as a loan and what is thee rate of interest charged?
As mutual fund values change every day, the bank applies a haircut to the full mutual fund value to determine maximum loan amount that can be availed. For equity mutual funds, 50% of the mutual fund value is available as a loan upto a maximum loan amount of Rs. 10 Lakh. For debt mutual funds, 80% of mutual fund value is available as a loan upto a maximum loan amount of Rs. 1 Crore.
The indicative rate of interest is 10.85%* and is subject to change from time to time.
Is there a cap on the maximum amount of loan I can get?
1. Maximum loan limit for equity mutual fund is Rs. 10 Lakh
2. Maximum loan limit for debt mutual fund is Rs 1 crore
There is a minimum loan amount of Rs. 2 Lakh on each of the above types of funds.
What is the tenure of the loan?
LAMF is an overdraft loan with no fixed tenure. The loan limit is just renewed every year seamlessly. You will not be able to sell the MF investments that you have pledged to avail the overdraft facility. Once you close the overdraft facility, you can get the pledge removed. Subsequently, you can sell these mutual fund units.
What is the eligibility for getting a Digital LAMF?
1. HDFC Bank Savings Bank Account with mode of operation as Single.
2. Customer should have NetBanking User ID and password.
3. Mutual Funds holding with CAMS as Transfer agent (List of Asset Management Company is given below).
4. Mutual Funds holding with CAMS as single.
5. Loan Application timings
Monday to Friday: 9.00 am to 7.00 pm
Working Saturdays: 9.00 am to 3.00 pm
Digital LAMF can be availed against the Mutual Funds issued by following Asset Management Companies and approved by HDFC Bank.
1. Aditya Birla Sun Life Mutual Fund
2. DSP Blackrock Mutual Fund
3. HDFC Mutual Fund
4. HSBC Mutual Fund
5. ICICI Prudential Mutual Fund
6. IDFC Mutual Fund
7. Kotak Mahindra Mutual Fund
8. L&T Mutual Fund
9. SBI Mutual Fund
10. Tata Mutual Fund
Apart from mutual funds, what other assets can I avail of to get a similar loan?
You are free to pledge any of the following securities:
• Equity Shares
• Mutual Funds (Equity) up to 50% of NAV
• Mutual Funds (Debt) upto 80% of NAV
• Life Insurance Policies issues by LIC and select Private Insurance Companies
• National Savings Certificates (NSC)
• Kisan Vikas Patra (KVP)
• NABARD’s Bhavishya Nirman Bonds
• Non-Convertible Debentures
• Long tenure bonds i.e NHAI,PFC, IRFCL, HUDCO.
Overdraft loans have traditionally been used by companies and the ultra-rich to manage their cashflow needs smartly while keep interest rates low. Digital LAMF has now bought this option possible to all of us. If used well, this can be a great way to avail of loans quickly, cheaply and ensure repayment terms are flexible. Get your own smart instant loan here.
For more information, read Part 1 & Part 2 of the LAMF Special to know why to avail of the LAMF Loan.