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

How Can I Pledge My Mutual Fund Investments to Get Collateral Margins in FYERS?

FYERS allows you to pledge approved mutual fund units to receive collateral margin, which can be used for trading in Futures & Options (F&O) and currency derivatives. This allows you to leverage your long-term investments without liquidating them.

The pledged units remain in your demat account but are marked as “Pledged.” While the funds are locked, you continue to earn returns, and the margin is released after applying a clearing corporation-defined haircut.

Overview of Mutual Fund Pledging on FYERS

Mutual fund pledging lets you convert eligible debt fund holdings into collateral for trading purposes. Only specific schemes—typically low-risk Overnight or Liquid Debt Funds—are allowed, based on their liquidity and credit quality.

The margin received depends on:

  • The fund’s latest NAV
  • The haircut applied by the clearing corporation (e.g., 5% for overnight funds)
  • Processing status and confirmation via depository (CDSL or NSDL)

Steps to Pledge Mutual Funds

On FYERS App

  1. Log in to the FYERS App
  2. Tap the Portfolio icon at the bottom of the screen
  3. Go to the Holdings tab and switch to the Pledge tab
  4. Select the eligible mutual fund scheme you want to pledge
  5. Enter the number of units or value to pledge
  6. Tap Submit and complete OTP-based authorisation via the CDSL/NSDL link

The margin typically becomes available by T+1 working day after successful confirmation.

On FYERS Web

  1. Log in to FYERS Web
  2. Click on Portfolio from the top menu
  3. Navigate to the Holdings section and switch to the Pledge tab
  4. Choose the mutual fund you want to pledge
  5. Enter the units or value to pledge and click Pledge
  6. Authorise the pledge on the CDSL or NSDL portal using OTP

You continue to earn NAV-based returns or IDCW (if applicable) on pledged units. However, you cannot redeem, switch, or modify these units until they are unpledged.

What If...

ScenarioOutcome
Mutual fund not showing in pledge listOnly ISINs approved by the clearing corporation are shown under the Pledgeable tab.
Margin is not reflecting after the pledgeMargin is credited only after successful confirmation and the T+1 settlement cycle.
Want to unpledge mutual fundsGo to the Pledged tab and select Unpledge to release collateral.
NAV of pledged fund decreasesYour collateral value may drop, reducing your margin availability.

Last updated: 15 Sep 2025

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