Loan Against Mutual Funds Interest Rate in India: What to Expect in 2025
If you’re exploring affordable borrowing options, a loan against mutual funds (LAMF) is worth considering. It’s a secured loan that not only offers flexibility and speed, but also some of the lowest interest rates in India — especially when compared to traditional personal loans.
In this blog, we’ll break down what to expect from loan against mutual fund interest rates in 2025, and how you can use this smart financing tool to your advantage.
Understanding Loan Against Mutual Fund Interest Rates
Since a loan against mutual funds is a secured loan, lenders charge significantly lower interest rates compared to unsecured loans. These rates typically depend on:
- Type of mutual fund pledged (equity, debt, hybrid)
- Loan amount and duration
- Lender’s cost of capital
- Borrower’s repayment history (if available)
Loan Against Mutual Funds Interest Rate in 2025: Latest Trends
Based on 2025 market data and lender trends, here’s what you can expect:
| Lender | Interest Rate (p.a.) | Foreclosure Charges |
|---|---|---|
| Yenmo | 10.5% | ₹0 |
| Traditional Banks | 11% – 13.5% | 1% – 4% |
| NBFCs | 12% – 15% | 1% – 3% |
Why Yenmo Offers the Best Interest Rates
Yenmo is built to give borrowers better value with:
- Flat 10.5% interest rate on loans against mutual funds
- No part-payment or foreclosure fees
- Monthly interest-only payments – repay principal anytime
- 100% digital onboarding and instant disbursal
Is It Better Than a Personal Loan?
Absolutely. Personal loans in India typically carry 12%–24% interest, credit score dependency, and strict repayment schedules. On the other hand, loans against mutual funds offer:
- Lower cost of borrowing
- No pressure to repay the principal immediately
- Investments continue to grow during the loan period
Final Thoughts
If you’re planning to raise short-term funds in 2025, exploring a loan against mutual funds can help you save big on interest, stay invested, and avoid the rigidity of personal loans.
Visit Yenmo.in to apply instantly and use our loan calculator to check how much interest you can save.
