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Investors Tap Mutual Fund Holdings to Manage Short Term Cash Needs
Loan against mutual funds is being increasingly used to raise short term funds at lower costs, helping investors preserve long term investments while benefiting from faster, digitally enabled borrowing solutions.
Loans against mutual funds are emerging as a practical financing option for investors seeking liquidity without exiting markets. By pledging fund units, borrowers avoid capital gains tax and benefit from lower interest rates compared with unsecured loans. Banks report rising interest from salaried professionals and small business owners, supported by quicker approvals and digitally enabled lien marking processes.