HDFC Bank Launches India’s First Digital Loans Against Securities

Posted on:17 Mar 2017 09:58:27
HDFC Bank Launches India’s First Digital Loans Against Securities
17 March 2017 Current Affairs: HDFC Bank in collaboration with National Securities Depository Limited (NSDL) has launched an instant Digital Loan against Securities (LAS) product on March 15, 2017.

 LAS will reduced the time to disburse the overdraft facility in just 3 minutes rather than several days previously. This is a first-of-its-kind initiative in India and probably the first in the world as well.

Key Features of the LAS : Under the facility, customers can pledge shares directly through their demat accounts and give necessary approvals while applying for the loan.

Shares dematerialised by NSDL and executed through HDFC Bank demat account could be used for pledging.

The bank will instantly approves the loan and the money will be credited to their bank accounts. Once shares are pledged, a customer cannot sell them unless the loan against them has been cleared.

The loan amount ranges from Rs 1 to 20 lakh for a period and every year the loan amount will be reevaluated.

The overdraft will be offered at an interest rate of 10.5 percent, same as the non-digital loans.

Initially the facility is restricted to only HDFC Bank demat account holders so customers need to open accounts with the bank to avail the digital service.

Besides, the facility will be available for Demat shares in the beginning which will soon be extended to other securities such as mutual funds, bonds and insurance policies.

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