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Key Features of IndusInd Bank Overdraft (OD) Facilities

  • Purpose: To provide flexible access to funds for short-term needs without liquidating investments or fixed deposits.
  • Types of OD Facilities:
    • IndusLAS (Loan Against Securities): OD against shares, mutual funds, bonds, or Sovereign Gold Bonds with up to 80% of security value. Interest rate starts from 11.25% p.a.
    • OD Against Fixed Deposits: Borrow up to 90-95% of FD value with interest typically 2% above the FD rate. No processing fees.
    • Drop-line OD: For businesses with structured repayment where the limit reduces monthly.
    • Salary-Linked OD: For salaried individuals with flexible repayment options.
    • Multiple Withdrawals: Borrowers can withdraw funds multiple times within the sanctioned limit, making it suitable for recurring expenses like business payments, bill settlements, or unexpected costs.
    • Withdraw as Needed: The overdraft facility allows you to withdraw funds up to a pre-approved limit whenever required, without needing to apply for a new loan each time. This is ideal for managing unpredictable or short-term cash flow needs.
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    • Eligibility: Available to individuals (including NRIs) and businesses with qualifying securities such as shares, mutual funds, bonds, or fixed deposits.
    • Minimum Requirements: Minimum age 21 years, maximum 65 years. For securities-based OD, must have Demat account with approved securities.
    • Collateral Options: OD can be secured (against securities/FDs) or unsecured. Secured ODs have relaxed credit requirements.
    • Credit Score Importance: More critical for unsecured OD; secured ODs focus more on collateral value.
    • Pre-approved Offers: Existing IndusInd Bank customers may receive pre-approved OD offers with minimal documentation.
    • Flexible Repayment: No fixed EMIs - repay as per your cash flow convenience, offering more flexibility.
    • Interest Rates: Typically lower than credit cards but may be higher than standard personal loans, charged only on utilized amount.
    • Limit Determination: The OD limit is set based on security value (up to 80% for shares/mutual funds, 90-95% for FDs) or income assessment.
    • Digital Management: Monitor and manage your OD facility through IndusInd Bank's mobile app or internet banking.
    • Renewal: The OD facility typically needs to be renewed annually, subject to review of your financial profile and collateral value.
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Benefits of IndusInd Bank Overdraft (OD) Facilities

  • Flexible Access to Funds: OD allows borrowers to withdraw funds as needed up to the sanctioned limit, making it ideal for short-term or recurring expenses. Repay at your convenience within the limit, unlike fixed EMIs in personal loans.
  • Low Interest Rates:
    • OD Against Securities: Interest rates start from 11.25% p.a., significantly lower than personal loan rates.
    • OD Against Fixed Deposits: Typically 2% above the FD rate, often lower than unsecured borrowing options.
    • Flexible Access to Funds: OD allows borrowers to withdraw funds as needed up to the sanctioned limit, making it ideal for short-term expenses. Repay at your convenience within the limit, unlike fixed EMIs in personal loans.
    • Low Interest Rates: OD Against Securities starts from 11.25% p.a., significantly lower than personal loan rates.
    • Interest on Utilized Amount Only: Interest is charged only on the amount withdrawn, not the entire OD limit, making it cost-effective compared to term loans.
    • Preserves Investments: OD against securities allows you to borrow without selling investments, ensuring continued potential for growth. Ideal for maintaining long-term investment strategies.
    • Quick Activation: Apply online via IndusInd Bank's internet banking for OD against securities with quick approval. Minimal documentation (Demat statement or FD details) speeds up the process.
    • Against Securities: Up to 80% of security value, potentially in lakhs depending on portfolio.
    • FD-linked OD: Up to 90-95% of FD value.
    • Business OD: Based on cash flow and business performance.
    • Flexible Tenure and Renewal:
    • Standard OD: 12 months, renewable annually.
    • Drop-line OD: Monthly reducing limit for structured repayment.
    • FD-linked OD: Aligned with FD maturity, renewable as needed.
    • Minimal or No Processing Fees:
    • OD against FDs: No processing fees.
    • Securities OD: 0.5-1% of the limit, lower than market standards.
    • Tailored for Specific Needs:
    • OD Against Securities: For investors needing liquidity without liquidating holdings.
    • Business OD: For businesses requiring working capital or inventory funding.
    • Salary-Linked OD: For salaried employees needing flexible credit.
    • No Prepayment Penalties: Repay the utilized OD amount at any time without penalties, offering flexibility to manage finances.
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Applying for IndusInd Bank Overdraft (OD) Facilities

  • Required Documents
    • OD Against Securities: Demat account statement, KYC documents (PAN/Aadhaar), address proof.
    • OD Against FDs: FD certificate or account details, identity proof, address proof.
    • Business OD: Business registration documents, ITR for last 2 years, bank statements.
    • Additional: Passport-size photographs; IndusInd Bank account details.
  • Application Process
    • 1. Online Application (OD Against Securities/FDs)
      • IndusInd Bank website or mobile app offers a seamless process for OD facilities.
      • Steps:
        • Visit IndusInd Bank's website or download the mobile app.
        • Log in with your account credentials.
        • Go to the "Loans" section and select "Loan Against Securities" or "Loan Against Fixed Deposit."
        • Choose the securities or FD you wish to pledge.
        • Specify the OD limit required (within permissible limits).
        • Upload required documents (Demat statement, FD certificate, KYC).
        • Complete e-signing for the OD agreement.
        • OD account is activated within 1-3 working days.
        • Monitor OD usage and interest via IndusInd Bank's digital platforms.
      • Tips:
        • Check for pre-approved OD offers for faster activation.
    • 2. Offline Application
      • Visit an IndusInd Bank branch for OD against securities, FDs, or business needs.
      • Steps:
        • Locate the nearest branch using the bank's branch locator.
        • Obtain the relevant OD application form.
        • Provide personal, account, and OD details (limit, purpose, security).
        • Attach self-attested copies of required documents.
        • Provide originals for verification, if requested.
        • Bank verifies securities/FD status and credit profile.
        • Receive a sanction letter with OD limit, interest rate, and tenure.
        • Sign the OD agreement at the branch.
        • OD account is activated within 3-7 working days.
        • Funds are accessible via the linked account.

Eligibility Criteria for Overdraft (OD) Facilities

  • General Eligibility
    • Age: Minimum: 21 years; Maximum: 65 years.
    • Nationality: Resident Indians and NRIs with Indian securities/FDs.
    • Credit Score: Preferred 750+ for better terms, relaxed for secured OD.
    • Bank Relationship: Active IndusInd Bank account preferred.
  • OD Against Securities (IndusLAS)
    • Must have Demat account with approved securities (shares, mutual funds, bonds).
    • Up to 80% of security value can be availed as OD limit.
    • Securities must be held with any Depository Participant (NSDL/CDSL).
    • Single scrip lending supported.
  • OD Against Fixed Deposits
    • Must have active FD with IndusInd Bank.
    • Up to 90-95% of FD value can be availed.
    • No income proof or credit score required.
    • FD must be in applicant's name.
  • Business OD
    • For business owners with at least 2-3 years of operations.
    • Minimum turnover requirements apply (varies by product).
    • Must have business bank account with IndusInd Bank.
    • Financial statements and ITRs required for higher limits.
  • NRI-Specific Requirements
    • Must have NRE/NRO account with IndusInd Bank.
    • Valid passport and overseas address proof required.
    • Indian securities or FDs must be pledged.
  • Other Requirements
    • Documentation: Varies by OD type—includes security proof, income documents, and KYC.
    • Minimum Limit: ₹2 lakh for securities-based OD.
    • Maximum Limit: Up to ₹50 crore based on collateral value.
  • Digital Onboarding Eligibility
    • Eligible applicants can apply fully online through the IndusInd Bank website or mobile app.
    • Aadhaar-linked mobile number and PAN required for eKYC verification.
    • Instant in-principle approval for eligible customers with pre-approved limits.
  • Eligibility for Pre-Approved OD Offers
    • Regular salary credit or transaction history in IndusInd account for 6+ months.
    • High savings account average monthly balance (AMB) improves chances.
    • Existing IndusInd FD or investment portfolio adds weightage.
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Documents Required for Overdraft (OD) Facilities - IndusInd Bank

  • General Documents (Applicable to All OD Types):
    Identity Proof (any one):
    - PAN Card (mandatory), Aadhaar Card, Voter ID
    - Passport
    - Driving License
    Address Proof (any one):
    - Aadhaar Card
    - Utility Bill (not older than 3 months)
    - Rent Agreement
    - Passport
    - Voter ID
    Other Documents:
    - 2-3 recent passport-size photographs
    - IndusInd Bank account passbook or statement
    - Cancelled cheque (if required)
    - OD application form (offline/online via mobile app)
  • OD Against Securities (IndusLAS):
    - Demat account statement showing ownership of securities
    - Lien request letter for pledged securities
    - List of securities to be pledged (shares, mutual funds, bonds)
    - KYC documents of all holders (for joint Demat accounts)
  • OD Against Fixed Deposits:
    - Fixed Deposit certificate or receipt
    - FD account statement or passbook entry
    - Declaration of FD ownership (for joint FDs)
    - No income proof required
  • Business OD:
    Business Proof:
    - Business registration, GST certificate, shop license
    - Partnership deed or incorporation certificate (if applicable)
    Income Proof:
    - ITR for last 2 years with computation
    - CA-certified balance sheet and P&L statement
    - Business bank statements (last 6 months)
    Other:
    - Proof of business continuity for 2+ years

Factors Affecting IndusInd Bank Overdraft (OD) Facility

  • Security/Collateral:
    - Securities OD: Up to 80% of security value; only approved securities qualify.
    - FD OD: Up to 90-95% of FD value; FD must be active with IndusInd Bank.
    - Unsecured OD: Based on credit profile and income.
  • Income and Financial Stability:
    - For unsecured OD: Minimum income requirements apply.
    - For business OD: Minimum turnover and profitability thresholds.
    - Stable cash flow as reflected in bank statements.
  • Credit Score:
    - Preferred CIBIL score of 750+ for better terms.
    - Lower scores may require additional collateral or higher interest.
  • Bank Relationship:
    - Existing customers with good history get better terms.
    - Length of relationship and account conduct considered.
  • Interest Rate:
    - Securities OD: Starts from 11.25% p.a.
    - FD OD: Typically 2% above FD rate.
    - Business OD: Varies by profile and collateral.
  • OD Limit and Tenure:
    - Minimum limit: ₹2 lakh for securities OD.
    - Maximum limit: Up to ₹50 crore based on collateral.
    - Tenure: Typically 12 months, renewable.
  • Documentation:
    - Complete and accurate documents speed up approval.
    - Updated financials required for business OD.
  • Age of Applicant:
    - Minimum age: 21 years; Maximum: 65 at maturity.
    - Younger applicants with strong profiles may get longer tenures.
  • Market Conditions:
    - For securities OD, market volatility may affect LTV ratios.
    - Changes in RBI policies may impact interest rates.
  • Repayment History (if any):
    - Previous repayment behavior on loans or credit cards influences OD approval and terms.

Frequently Asked Questions (FAQs)

What types of OD facilities does IndusInd Bank offer?
  • IndusLAS (Loan Against Securities): OD against shares, mutual funds, bonds with up to 80% of security value.
  • OD Against Fixed Deposits: Up to 90-95% of FD value with interest typically 2% above FD rate.
  • Drop-line OD: For businesses with structured monthly repayment.
  • Salary-Linked OD: For salaried individuals with flexible repayment.
Who is eligible for an IndusInd Bank OD facility?
  • Individuals: Age 21-65 years with qualifying securities or FDs.
  • Businesses: Minimum 2-3 years operations with stable income.
  • NRIs: With Indian securities/FDs and NRE/NRO account.
  • Credit Score: Preferred 750+ but relaxed for secured OD.
What is the OD limit and tenure?
  • Minimum Limit: ₹2 lakh for securities-based OD.
  • Maximum Limit: Up to ₹50 crore based on collateral value.
  • Tenure: Typically 12 months, renewable annually.
  • FD OD: Aligns with FD maturity date.
What are the interest rates for OD facilities?
  • Securities OD: Starts from 11.25% p.a.
  • FD OD: Typically 2% above the FD interest rate.
  • Business OD: Varies by profile, starting from 13% p.a.
  • Interest is charged only on the amount utilized.
What documents are required for an OD facility?
  • Securities OD: Demat statement, KYC documents, lien request.
  • FD OD: FD certificate, KYC documents.
  • Business OD: Business registration, ITRs, financial statements.
  • Note: Existing customers may need minimal documentation.
How can I apply for an OD facility?
  • Online: Via IndusInd Bank website or mobile app for securities/FD OD.
  • Offline: Visit any branch with required documents.
  • Processing Time: 1-3 days for FD OD, 3-7 days for securities OD.
Are there any processing fees for OD?
  • FD OD: No processing fees.
  • Securities OD: 0.5-1% of sanctioned limit plus GST.
  • Business OD: 1-2% of limit plus GST.
Can I repay the OD amount early?
Yes, IndusInd Bank allows early repayment without any prepayment penalties for OD facilities. You only pay interest for the duration you use the funds.
What is the advantage of OD over a personal loan?
  • Flexibility: Withdraw funds as needed within the limit.
  • Lower Cost: Interest only on utilized amount (11.25%+ vs 12-24% for personal loans).
  • Investment Protection: OD against securities lets you access funds without selling investments.
What happens if I default on OD repayments?
  • Penal interest of 2-3% p.a. may be applied on overdue amounts.
  • For secured OD, bank may liquidate collateral to recover dues.
  • Defaults negatively affect your credit score.
Can I get an OD without an IndusInd Bank account?
No, you need an active savings/current account with IndusInd Bank to link the OD facility. For FD OD, the FD must be with IndusInd Bank.
How is the OD limit renewed?
  • Subject to annual review of your financial profile and collateral value.
  • For securities OD, limit may be adjusted based on current market value.
  • Timely interest payments and proper utilization improve renewal chances.

List of Overdraft (OD) Facilities at IndusInd Bank

  • IndusLAS (Loan Against Securities)
  • Overdraft Against Fixed Deposits
  • Drop-line Overdraft Facility
  • Salary-Linked Overdraft
  • Overdraft against Shares
  • Overdraft against Mutual Funds
  • Overdraft against Shares
  • Overdraft against Mutual Funds