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A Quick Guide on Loan against Securities

With time traditional bank loans have become costly therefore, the lenders are coming up with new options to allow meeting intermediate cash flow requirements of customers. A loan against shares is one such facility that is provided by banks and NBFCs against certain securities owned either by the borrower’s relatives or the borrower himself. For instance, if you are provided with a loan against securities of worth Rs. 2 lakhs and in case, you withdraw Rs. 50,000 and deposit the money back into account within a month. In that situation, you will be charged interest for just one month on Rs. 50,000.  
Some of the steps to be followed are mentioned below:
In order to avail loan against shares, all you got to do is fill the application form with
personal details of the borrower and of securities to be undertaken.
The documents required for the loan against securities are identity proof, address proof,
signature proof, IT returns of concerned company/proprietorship/partnership firm,
audited balance sheet and Profit & Loss account for the previous two years.
In order to be eligible for this particular loan, the applicant either has to be Indian resident,
NRI or owner of a private trust, partnership firm, sole proprietorship, and private limited or public limited company.

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