Micro Financing by Registered societies or trusts
Guest
(Querist) 11 April 2010
This query is : Resolved
As I have studied registered societies and trusts can do micro financing legally and they do not need to take any separate money lenders license also.
Is it right?
Can these institutions borrow money from public for micro -financing?
Can they accept donations for micro financing,Can they use donation money for micro financing?
From where they will get the funds to do micro-financing ?
Please help,thanks in advance.
Raj Kumar Makkad
(Expert) 11 April 2010
Registered trusts and societies are also bound by Money Lenders Act and they are also supposed to get such license as required to an individual with a condition that the bye-laws of such trusts and societies permit to do such financing business.
Guest
(Querist) 11 April 2010
raj kumar ji,
I am pasting a part of Punjab money lenders act,plz. go through it, esp. (v)point ---
(8) “Loan” means an advance whether secured or unsecured of money or in kind at interest and shall include any transaction which the court finds to be in substance a loan, but it shall not include-
(i) an advance in kind made by a landlord to his tenant for the purposes of husbandry; provided the market value of the return does not exceed the market value of the advance as estimated at the time of advance;
(ii) a deposit of money or other property in a Government Post Office Bank, or any other Bank, or with a company, or with a co-operative society or with any employer as security from his employees;
(iii) a loan to, or by, or a deposit with any society or association registered under the Societies Registration Act, 1860, or under any other enactment;
(iv) a loan advanced by or to the Central or any [State] Government or by or to any local body under the authority of the Central or any [State] Government;
(v) a loan advanced by a bank, a co-operative society or a company whose accounts are subject to audit by a certified auditor under the Indian Companies Act, 1913;
(vi) a loan advanced by a trader to a trader, in the regular course of business, in accordance with trade usage;
(vii) an advance made on the basis of a negotiable instrument as defined in the Negotiable Instruments Act, 1881, other than a promissory note.
Guest
(Querist) 11 April 2010
raj kumar ji,sorry ,it is the (iii) point that is related to trusts and societies.
