Straight to the point, no matter who we are at present, all of us are prone to financial problems either today or tomorrow. None of us is immune to that, and thus, the least we can do is find out the conducive alternatives for such situations and keep our options open. Accordingly, here’s how loan against securities and the perks of taking it.
What is a loan against securities?

A loan against securities is a secured financing solution offered by various financial institutions in India. The applicant can pledge their securities such as an FD bond, mutual funds bond or debentures etc. and avail a loan against the collateral’s market value.

How can loan against securities help? How is it better than liquidating your investment?
When you apply for the said credit scheme, you
  • Get sufficient funds to manage your cash needs without liquidating your investment.
  • Are able to preserve the maturity value of your investment.

Perks of taking a loan against securities:-

  1. End usage flexibility: The money you get as loan comes with end-usage flexibility: without any restrictions on the usage by the lender.
  2. Lower interest rate: As the facility falls under the secured loan category, the interest rate is always on the lower side.
  3. A wider repayment time: Last but not the least, the facility comes with a wider repayment time compared to other equivalent options.

In the end, just make sure you do enough research before opting for a particular scheme.

For more information related to perks of loan against securities read here: What are the benefits of taking loan against securities?