personal loan from bank for F&O trading


I am a salaried individual working for IT MNC earning 10 lakhs per year.

Can i take a personal loan of 5 lakhs from bank and trade in F&O (writing OTM call/put options)?

RBI guideline mentions that the personal loan cannot be used for trading/investing in stocks or any other speculative activity.

But F&O is treated as non speculative business.

So taking personal loan and trading in F&O is allowed?

Thanks in advance!

Santhosh Asked on September 10, 2017 in Others.
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1 Answer(s)

Dear Santhosh

Terms of Loans and its application can be checked at the time of Banks Sanction. Personal loans are normally given to meet the expenditure. Monitoring the application of personal loans applications is tough for any agency. Do follow the Sanction terms and purpose for which you have taken loan to be safe .


TaxIQ Answered on September 11, 2017.
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