LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Money Lenders Act

Page no : 2

C.P.Palanichamy (Advocate)     18 January 2010

Dear forum Members,

The Judgment of the Kerala High Court was upheld by the Division bench in W.A.No. 540/2007 in the case of Sundaram Finance Ltd., vs State of Kerala on 18.11.2009. ( Reported in Kerala Law Times fourth volume 2009) Now the corporate bodies moved the Apex court against the Judgement in SLP.No. 34057/2009 in the case of M/s Muthoot Finance corp Ltd., vs State of Kerala and ors.


I agree with Mr Manish Singh. The NBFC's under the guise of doing business as per RBI Regulations claiming to be exempted from the state laws. As rightly pointed out by Mr. Manish, the RBI Concerns only with the complanies who accepts Public deposits in order to protect the innocent public from depositing their money in some unknown companies. If any NBFC doing the business of lending Money, they are governed under the concerned state laws in force.

1 Like

Anil Agrawal (Retired)     18 January 2010

 Thus, it is plain and simple.

A NBFC must register with the RBI under Section 45IA of the RBI Act, 1934 and as pointed out by the RBI it must, if not exempted by the State Government, get itself registered under the Money Lenders Act as well. 

In Maharashtra, Registrar of Cooperative Societies is the registering authority.

1 Like

Umesh (Lawer)     24 January 2010


Is the money lending license is required to provide loan with interest to Trader to Trader……?

Anil Agrawal (Retired)     24 January 2010

 Yes, if it charges interest and is  one of its regular business.

Umesh (Lawer)     25 January 2010

For Hire Purchase Loan Business which license is requried...........?

Anil Agrawal (Retired)     25 January 2010

 Is it a NBFC or a money lender?

Umesh (Lawer)     26 January 2010

my client doing individuals finance business on the basis of Hirer Purchase Agreement  then  which license is requried.............?

Anil Agrawal (Retired)     26 January 2010

 All money lenders are doing business on individual basis. They have to obtain a licence. If you see the signboard on their office / shop, the licence no. is clearly written.

Umesh (Lawer)     26 January 2010

I am thankful to you clarification………………

Rajesh Soni (Owner)     04 March 2010

Hello everyone!

A friend of mine wants to start "Money Lending" as a part-time business. He is does freelancing business, and wants to start lending money as an additional source of income (against Gold).

Can you please throw some light on how should he proceed ?

Thanks in advance.


Anil Agrawal (Retired)     05 March 2010

Mr. Soni

There is a  prescribed appln form. Go to the Dy. Registrar of coop societies of your ward and apply. He is the registering authority for ML lience inMaharashtra.

1 Like

Rajesh Soni (Owner)     05 March 2010

Thank you, Anil for your quick reply. Much appreciated :)

Pushkar (none)     18 January 2011


Krishnan Iyer (Law Officer)     24 November 2012

hi we are a NBFC registered under the RBI Act and Companies Act is there a need for us to get registered with Bombay Money Lenders Act?? Moreover we dont acctep public deposits so do we come under the purview of the Money lenders act??

Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Start a New Discussion Unreplied Threads

Post a Suggestion for LCI Team
Post a Legal Query