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Tata Capital > Blog > Loan on Securities > How Does a Loan Against Security Work?

Loan on Securities

How Does a Loan Against Security Work?

How Does a Loan Against Security Work?

Are you thinking of liquidating your shares and mutual funds to address a cash crunch? Don’t! Instead of selling off your investments hurriedly, take a loan against securities. Let us look at the list of investments you can pledge to avail of this finance option -

  • Shares
  • Bonds
  • Mutual funds
  • Insurance Policies
  • Non-convertible debentures
  • National Savings Certificate (NSC)

Features of LAS Loans

  • An applicant is generally sanctioned up to 85% of the value of pledged securities
  • A loan against security is a secured loan where shares, debentures, mutual funds, etc. are offered as collateral
  • The loan tenure is one year but can be renewed hassle-free
  • The processing fee is generally 2% of the total loan amount
  • You can prepay a loan against security without any penalty or fee

Eligibility Criteria

  • The applicant has to be between the ages of 18 years and 65 years
  • The applicant should be a citizen of India residing permanently in the country
  • The applicant should be able to show a stable source of income
  • The pledged security must be bank-approved.

Documents Required

  • Proof of identity – PAN card, driver’s license, passport, Aadhaar Card (any 1)
  • Proof of address – ration card, utility bills, passport (any 1)
  • Proof of income – If you are a self-employed person, then submit last 6 months bank statements, IT returns for 2 years, balance sheet, profit and loss account, proof of business, and office address. If you are a salaried employee, then submit last 6 months bank statements showing salary credits, last 3 months’ salary slips, and cancelled cheque
  • Demat account statements
  • Passport-size photograph

How to Apply for an LAS Loan?


Applying for a loan against security is very convenient, especially if you do it online and figure out your loan against securities eligibility criteria. After this, fill out a short digital form describing the securities you wish to pledge. Hit ‘Apply’ and get a quick approval once your documents are verified.


You can also visit the nearest branch of your lending institution if you wish to avail this loan. Make sure you prepare your documents beforehand to save time and reduce the number of trips to the branch. Your loan against security will be sanctioned if an official is satisfied with your paperwork.

The Bottom Line

Loan against securities is a path-breaking new financial product in the market. To apply for this loan, choose India’s leading lending institution – Tata Capital. We offer competitive loans against security interest rates, starting at just 10.5%!

Our loan against security offers the following benefits -

  • Availability of overdraft facility
  • There are no charges for foreclosure or prepayment. This benefit allows you to choose flexible and convenient EMI plans.
  • An applicant can swap securities based on their stock market assessment.
  • The application processing is quick.  
  • The borrower can avail this loan for amounts ranging between Rs.5 lakhs to Rs.20 crores.
  • The loan tenure is of 1 year but is automatically renewable.
  • You can apply for an LAS loan through the website or also via WhatsApp. 

Additional Read:- Top Documents Required for a Loan Against Security

If you wish to know more about it, check out our loan against security product offering or give us a call at 1860 267 6060 today!

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