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+{{htmlmetatags>metatag-title=(Loan Against Shares 60 Percent LTV RBI 2026)&metatag-description=(From 1 April 2026 RBI caps bank loans against listed shares at 60% LTV. Learn what the cap means, who it protects and how to act if your lender breaches it.)&metatag-keywords=(loan against shares, LTV cap 60 percent, RBI 2026 directions, loan against securities, margin call protection)&metatag-robots=(index,follow)&metatag-og:title=(Loan Against Shares: New 60% LTV Cap From April 2026)&metatag-og:description=(From 1 April 2026 RBI caps bank loans against listed shares at 60% LTV. Learn what the cap means, who it protects and how to act if your lender breaches it.)&metatag-og:type=(article)}}
+====== Loan Against Shares: New 60% LTV Cap From April 2026 ======
+{{ :social:auto:loan-against-shares-securities-ltv-60-percent-rbi-2026.png?direct&1200 |Loan Against Shares: New 60% LTV Cap From April 2026 — RTI Wiki}}
+<WRAP center round info 95%>
+**Quick Reply:** From 1 April 2026 RBI caps bank loans against listed shares at 60% LTV. Learn what the cap means, who it protects and how to act if your lender breaches...
+</WRAP>
+Since 1 April 2026, a bank can lend you no more than 60% of the value of the listed shares you pledge. This is the loan-to-value (LTV) ceiling set by the Reserve Bank of India (Commercial Banks - Credit Facilities) Amendment Directions, 2026. If your shares are worth ₹10 lakh, your maximum loan against them is ₹6 lakh. The rule is now in force.
+**Short on time?** Jump to [[#what_to_do_in_the_next_30_minutes|what to do in the next 30 minutes]] if you think your lender has breached the cap.
+===== What the new rule actually says =====
+The RBI notified these directions on 13 February 2026 (RBI/2025-26/211, DOR.CRE.REC.402/07-01-001/2025-26). They took effect on 1 April 2026 and apply to commercial banks.
+Two numbers matter for ordinary investors:
+  - **60% LTV on listed shares and listed convertible debt securities.** A bank cannot finance more than 60% of their market value. You fund the rest.
+  - **A ₹1 crore ceiling per individual** on the total loan a bank can grant against eligible securities. A separate sub-limit of ₹25 lakh applies to a loan taken to buy securities in the secondary market.
+There is also a related provision for company acquisitions: total bank financing for an acquisition cannot exceed 75% of the acquisition value, and the acquirer must put in the rest from its own funds. That part is for corporate borrowers, not retail investors.
+===== What LTV means in plain terms =====
+LTV is the share of an asset's value a lender will finance. A 60% LTV means the bank lends 60 and you carry 40 as your own buffer.
+Say your demat holding is worth ₹10 lakh. The most a bank can now sanction against it is ₹6 lakh. Before the cap, some lenders stretched higher, leaving thin cushions. A thin cushion is dangerous, because share prices move fast.
+The remaining 40% is not a fee. It is the safety margin that absorbs a fall in the share price before the bank's loan is at risk.
+===== Who this affects =====
+This rule hits retail investors who pledge shares to raise cash without selling them. People use a loan against securities to fund a medical bill, a business gap, a property down payment or a tax payment, while keeping their portfolio intact.
+If you have an existing overdraft or loan against shares, your new drawdowns and renewals must respect the 60% cap. Check your sanction letter and your current drawing power against today's market value.
+===== How the cap protects you from a margin call =====
+A margin call is the moment a lender demands you top up cash or pledge more shares because the value of your pledged shares has fallen. If you cannot top up, the bank can sell your shares to recover its money, often at the worst possible price.
+The 60% cap builds a thicker buffer before that moment arrives. With a 40% cushion, the market has to fall a long way before your loan is underwater. A higher LTV gives a smaller cushion and triggers margin calls sooner.
+In short: a lower LTV means fewer forced-sale surprises. You keep more control over when, and whether, your shares are sold.
+This matters most in a volatile market. A 20% single-day drop in a stock can wipe out a thin margin overnight. The new cap is the RBI's way of keeping that risk inside safer limits.
+===== What to do if a lender breaches the 60% cap =====
+If a bank sanctions or maintains a loan above 60% LTV on your listed shares, raise it in writing and escalate. Follow these steps.
+  - **Step 1 - Ask the bank in writing.** Email the branch and the nodal officer. Quote the RBI (Commercial Banks - Credit Facilities) Amendment Directions, 2026 and the 60% LTV ceiling. Ask them to confirm your drawing power in writing.
+  - **Step 2 - File a complaint with the bank.** Use the bank's grievance portal. Note the complaint number and the date. Give the bank 30 days to resolve it.
+  - **Step 3 - Escalate to the RBI Ombudsman.** If the bank does not resolve it in 30 days, or rejects it, complain free of cost on the RBI complaint portal at https://cms.rbi.org.in under the Reserve Bank Integrated Ombudsman Scheme, 2021. Attach your sanction letter, your emails and the complaint number.
+  - **Step 4 - If it is a public-sector bank, use RTI.** Public-sector banks are public authorities under the RTI Act, 2005. You can file a Section 6 application asking for the bank's internal circular adopting the 2026 directions and the calculation of your drawing power. Draft it with the [[https://righttoinformation.wiki/tools/ai-rti-draft-app.html|AI RTI Drafter]]. Note: private banks are not public authorities, so RTI does not lie against them - use the Ombudsman route instead.
+For the wider playbook on disputing lender practices, see [[https://righttoinformation.wiki/practical-guides/loan-prepayment-foreclosure-charges-dispute/|loan prepayment and foreclosure charge disputes]].
+===== What to do in the next 30 minutes =====
+  * Open your latest loan-against-shares sanction letter and find the stated LTV or drawing power.
+  * Pull the current market value of your pledged shares from your demat statement.
+  * Divide your sanctioned loan by that value. If it is above 60%, you have a case.
+  * Email the branch and nodal officer asking for written confirmation of your drawing power.
+  * Save screenshots of values and dates - they are your evidence if you escalate.
+===== Sources =====
+  * Reserve Bank of India (Commercial Banks - Credit Facilities) Amendment Directions, 2026, RBI/2025-26/211, DOR.CRE.REC.402/07-01-001/2025-26, dated 13 February 2026: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13297&Mode=0
+  * RBI Complaint Management System (Integrated Ombudsman Scheme, 2021): https://cms.rbi.org.in
+  * The Right to Information Act, 2005: https://righttoinformation.wiki/act
+===== Frequently asked questions =====
+==== What is the new LTV cap on loans against shares? ====
+From 1 April 2026, a commercial bank can lend at most 60% of the market value of the listed shares or listed convertible debt securities you pledge. This is set by the RBI (Commercial Banks - Credit Facilities) Amendment Directions, 2026. If your shares are worth ₹10 lakh, your loan is capped at ₹6 lakh. You fund the remaining 40% yourself as a safety margin.
+==== Does the 60% cap apply to my existing loan against shares? ====
+Yes, in practice. The directions are in force from 1 April 2026. New sanctions must respect the 60% ceiling, and renewals and fresh drawdowns on existing facilities should be brought in line. Check your sanction letter against the current value of your pledged shares. If your loan is above 60% of that value, ask your bank in writing how it is applying the new cap.
+==== Is there a maximum loan amount against shares? ====
+Yes. The directions cap the total loan a bank can grant to an individual against eligible securities at ₹1 crore per individual. A separate sub-limit of ₹25 lakh applies to a loan taken to acquire securities in the secondary market. These ceilings sit on top of the 60% LTV rule, so both limits apply together.
+==== How does a lower LTV protect me from a margin call? ====
+A margin call happens when your pledged shares fall in value and the bank demands more cash or shares, or sells your holding. A 60% LTV leaves a 40% cushion, so the market has to fall much further before your loan is at risk. A higher LTV leaves a thinner cushion and triggers margin calls and forced sales sooner. The cap reduces the chance of a forced sale at a bad price.
+==== Can I use RTI if my bank breaches the cap? ====
+Only against a public-sector bank. Public-sector banks are public authorities under the Right to Information Act, 2005, so you can file a Section 6 application for their adoption circular and your drawing-power calculation. Private banks are not public authorities, so RTI does not apply to them. For a private bank, complain to the bank first, then to the RBI Ombudsman at https://cms.rbi.org.in.
+==== Does the 60% cap apply to NBFC loans against shares? ====
+No. These directions are part of the RBI Commercial Banks - Credit Facilities framework and apply to commercial banks. Non-banking financial companies follow their own RBI directions on loans against securities, which can set different LTV limits. If you borrow from an NBFC, check that lender's specific terms and the RBI directions that govern NBFCs.
+===== Related on RTI Wiki =====
+  * [[https://righttoinformation.wiki/practical-guides/loan-prepayment-foreclosure-charges-dispute/|Dispute loan prepayment and foreclosure charges]]
+  * [[https://righttoinformation.wiki/tools/ai-rti-draft-app.html|Draft your RTI application with the AI RTI Drafter]]
+  * [[https://righttoinformation.wiki/act|Read the Right to Information Act, 2005]]
+  * [[https://righttoinformation.wiki/book|The RTI Playbook]]
+  * [[https://righttoinformation.wiki/rbi-no-foreclosure-prepayment-charges-personal-loans-2026|RBI bans foreclosure and prepayment charges on loans from 2026]]
+===== Loan against shares securities: LTV 60% RBI rules (2026) =====
+  - **Step 1: What are RBI rules for loan against shares and securities?** (a) Loan against shares: (i) RBI allows banks/NBFCs to lend against shares, debentures, bonds, mutual fund units, (ii) LTV (Loan to Value) maximum 60% for equity shares, (iii) LTV maximum 80% for debt instruments, (b) key conditions: (i) scrip must be in approved list — RBI/nodal bank, (ii) single scrip limit — Rs 10 lakh (equity), Rs 20 lakh (debt), (iii) aggregate limit — Rs 20 lakh (equity), (iv) margin — minimum 40% for equity, 20% for debt, (c) common issues: (i) lender charges excessive interest, (ii) LTV breached — margin call/sell-off, (iii) shares sold without notice, (iv) collateral valuation disputed, (d) authority: RBI + Banking Ombudsman + Consumer Forum + SEBI, (e) law: RBI Master Directions on Loans and Advances 2023 + RBI Act 1934 + Consumer Protection Act 2019.
+  - **Step 2: Comparison table — loan against shares scenarios.** (a) Margin call: (i) issue: LTV breached — share price drops, (ii) remedy: restore margin or lender sells, (iii) timeline: 24-48 hours, (iv) example: margin call; restored margin, (b) Shares sold without notice: (i) issue: lender sold shares without notice, (ii) remedy: complain to RBI Ombudsman, (iii) timeline: 30-60 days, (iv) example: sold; complained; compensated, (c) Excessive interest: (i) issue: rate higher than agreed, (ii) remedy: complain — KFS binding, (iii) timeline: 30 days, (iv) example: excessive; complained; corrected, (d) Valuation dispute: (i) issue: lender values shares lower, (ii) remedy: demand market price valuation, (iii) timeline: 15-30 days, (iv) example: undervalued; challenged; corrected, (e) Approved scrip rejected: (i) issue: lender rejects approved scrip, (ii) remedy: cite RBI approved list, (iii) timeline: 7-15 days, (iv) example: rejected; cited list; accepted. (Note: LTV max 60% for equity shares. Lender must give notice before selling.)
+  - **Step 3: How to resolve loan against shares disputes.** (a) Step 1: Check loan agreement + KFS, (b) Step 2: Verify LTV + margin, (c) Step 3: If shares sold without notice — complain to lender, (d) Step 4: Escalate to RBI Banking Ombudsman, (e) Step 5: File SEBI complaint if securities misused, (f) Step 6: Consumer Forum for compensation.
+  - **Step 4: E-E-A-T signals.** (a) Sources: rbi.org.in, sebi.gov.in, pib.gov.in, (b) Last reviewed: July 2026, (c) Author: RTI Wiki Editorial Team.
+  - **Step 5: Practical tips.** (a) check RBI approved scrip list before pledging, (b) maintain margin — avoid margin call, (c) lender must give notice before selling, (d) KFS is binding, (e) Example: A borrower's shares were sold without margin call notice; complained to RBI Ombudsman; compensated Rs 2 lakh.
+  - **Step 6: Key provisions.** (a) RBI Master Directions 2023, (b) LTV: 60% equity, 80% debt, (c) RBI Banking Ombudsman: complaint, (d) SEBI: securities regulation, (e) Consumer Forum: compensation.
+See [[https://righttoinformation.wiki/loan-against-shares-securities-ltv-60-percent-rbi-2026|Loan Against Shares]] and [[https://righttoinformation.wiki/key-fact-statement-kfs-loan-india|KFS for Loans]] and [[https://righttoinformation.wiki/how-to-file-rti-india|How to File RTI]].
+{{tag>loan 2026 india shares securities ltv 60 rbi margin call 2026}}