How to pledge mutual fund units as collateral for a loan

Tue, 19 May 2026 00:00:00 +0000

Pledging mutual fund units for a loan is a way to access liquidity without redeeming the investment. The units remain in your name (you retain ownership and continued NAV appreciation); the lender has a lien on them. The loan-to-value (LTV) ratio is typically 50-65% for equity MFs and higher for debt.

Conflict-of-interest disclosure. This guide is published by WebNotes Editorial Team for informational purposes. WebNotes has no commercial relationship with any AMC, bank, or NBFC. No affiliate commission is earned. For substantial loans, consult a CA / financial advisor.

How to pledge mutual fund units for Zerodha margin

Tue, 19 May 2026 00:00:00 +0000

Pledging mutual fund units in your Zerodha demat account lets you use them as collateral for margin trading in F&O (futures and options), intraday equity, and currency / commodity segments. The mechanism allows long-term MF investors to participate in margin trading without redeeming their long-term equity exposure.

This guide covers the procedure, the LTV haircut framework, and the operational considerations.

Conflict-of-interest disclosure. This guide is published by the WebNotes Editorial Team for informational purposes and is written independently. WebNotes operates a Zerodha account-opening referral programme, disclosed on the pages that carry the referral link; this guide does not carry it and earns no referral commission from the procedure described here.

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How to pledge mutual fund units as collateral for a loan

How to pledge mutual fund units for Zerodha margin