Business News | Tata Capital launches digital onboarding journey for equity-based loans
Bombay (Maharashtra) [India], July 16 (ANI/BusinessWire India): Tata Capital Ltd, already known for its unique and unprecedented financial facilities, has recently made another stunning announcement. The company has launched a digital onboarding journey for equity-based loans. As part of the launch of the facility, Abonty Banerjee, Chief Digital Officer of Tata Capital, said the digital LAS offered by NBFC will help its customers meet their financial needs easily. She further said that Tata Capital is confident that its new credit facility will benefit its customers. Tata Capital has introduced the facility through its digital customer service portal, which can be used to place pledge requests digitally using the NSDL API and gain the same approval from the respective depositary (DP) participants. The availability of this online facility should make the process of obtaining credit against equity very convenient and quick. How does the “loan for equity” facility work? Loan Against Shares is a facility where people can take loans against shares in their Demat account as collateral. The maximum amount that an individual can avail is determined by a percentage of the total market value of the shares present in the individual’s portfolio. In India, banks can lend a maximum of Rs. 20 Lakh under a single entity under the LAS facility. However, being a Non-Banking Finance Company (NBFC), Tata Capital can offer up to Rs. 5 Crore credit under the LAS facility. Tata Capital is one of the first NBFCs to offer an end-to-end integrated digital onboarding experience for equity-based loans. Who is eligible for Tata Capital LAS facility?
The eligibility criteria to benefit from the Tata Capital Loan Against Shares facility are as follows –
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1. Individuals: Employed and self-employed persons who fall within the age bracket of 18 to 65 are eligible for the LAS facility.
2. Non-Individuals: Entities that have been in existence for at least two years are eligible for the credit facility.
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Required Documents for Equity Loan Facility: To avail of this facility, one must submit the following documents:
– Photo ID proof such as Aadhaar card, PAN card etc.
– Proof of address such as passport, utility bill, bank book, etc.
– Bank statement for the last six months
– Tax return for the last two years
– Pay slips for the last three months
– 1 security check
– A passport size photo
What are the key benefits of Tata Capital’s LAS facility?
One can enjoy the following benefits by availing LAS facility with Tata Capital –
– Online Process: The process from application, account creation, share pledge and identity verification to amount transaction can be done online. No paperwork and no branch visits required. You can also sign your documents electronically and benefit from the e-Nach function.
– Retention of title: when a person pledges their shares to benefit from a loan from Tata Capital, they continue to retain ownership of their shares. They can continue to benefit from the returns generated by their investment in the stock market, because they do not need to liquidate them.
– Zero Scope of Error: With Tata Capital’s online customer service and integration platform, there is zero risk of document error, whether those submitted to the NBFC or those traded with the DPs. Thus, it helps to avoid the risk of rejection of their application and delays in processing the loan amount.
– Interest payable on loan amount used only: When using the LAS facility with Tata Capital, interest only needs to be paid on the amount used as the loan by them and not on the total credit extended by NBFC. The remaining line of credit can be used as an overdraft facility.
– Loan processing in 1 day: once the documents submitted by the individual have been verified, the shares are pledged and the final approval is given, it takes only one day for the individual to receive the full amount of the loan ready.
– No Foreclosure or Prepayment Penalties: One can repay the loan amount whenever they want, even if it is only 1 or 2 days after disbursing the loan from Tata Capital. NBFC does not charge any foreclosure or prepayment penalties.
With the LAS facility offered by Tata Capital, one can leverage his investment to meet his credit needs while enjoying the return on investment. All one has to do is pledge their shares digitally, and they can get a loan of up to Rs. 5,000,000,000!
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