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How can I pledge my mutual fund investments to get margins?

Watch this Youtube video walkthrough on pledging or check out the process below.

You can pledge the stocks and mutual funds listed in this sheet to get collateral margins¹. They are divided into cash components² and non-cash components³.

Visit the holdings page on Console. In the holdings table, hover the cursor on the mutual fund you want to pledge and click on 'options' and select pledge for margins.

Once you select this, you will get a pop-up, which shows how much margin you will be eligible for.

You can cancel your pledge request as long as it's not processed.

P.S: Pledge will be processed in the new pledge system in batches, once at 2.00 pm and once at 5.00 pm. Even if you create a pledge request at 11.00 am, you will receive the email from CDSL only at 2.15, once Zerodha has setup the pledge

Notes

¹ The clearing corporation has set a certain limit on the number of shares/units that can be pledged per security through a broker. If the broker limit is reached, you will not be able to further pledge such securities for margin.

² The collateral margin received by pledging cash component securities can be used fully towards any margin requirement for your open positions. You will not be required to maintain cash separately if the collateral from cash component securities covers the margin requirement.

³ The collateral margin received by pledging non-cash component securities can be used only up to 50% of the margin requirement for your open positions. The exchange stipulates for the remaining 50% margin to come in the form of cash or cash equivalent collateral. Any additional utilisation of the non-cash collateral, over and above 50% of the margin requirement will be liable to delayed payment charges. See What is delayed payment charges?

Important :

1. Pledged liquid mutual funds are considered cash equivalent like liquidbees and you will be able to see it as collateral (liquid funds) under the funds tab on Kite.

2. If you have placed an unpledge request before 2 PM, the mutual funds will be available in the DEMAT account on T+1 day, and you will be able to redeem on the T+2nd day from Coin. If you have placed a request after 2 PM, the mutual funds will be available in Demat for trading the day after, and you will be able to redeem them on the T+3rd day.

3. Charges for pledging Mutual Funds are the same as shares: Rs. 30 + GST which is charged only when you pledge the Mutual Funds.

4. There are no charges for unpledging.

Did you know?

If you want to invest in Mutual Funds for the purpose of pledging, it's important to know that you can only invest in Direct mutual funds on Coin. On this sheet , we have mentioned Direct and Regular on a separate column. You will not be able to find the schemes which are under Regular on Coin.

You can search the mutual funds on Coin web using the ISINs from the sheet . You cannot search with the ISIN on the app.