Upgrad LLM

rbi lenders licence


Dear Attorneys,
 

One of my friend has borrowed money from me to pay off his bank loan.  The amount is 7 Lakhs.  Do I need to have RBI Lending Licence for this transaction to be  valid?

I am not a money lender by profession. 

 
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Cheque Victim's Lawyer. LUDHIANA (PB)

HI , 

You hv paid the amount to your friend for any of his purpose , it does not matter.

The main concern is that you have paid the amount in cash or through bank.

If you have paid cash than this is uncounted money , it will be difficult to recover you in case he dont return you.

If you have paid by bank trasaction than its recoverable and  treat yhis amount as UNSECURED LOAN in your books of accounts , you need not to take any Licence from RBI in this type of narated transactions. In business giving and taking unsecured loan is normal feature but throgh bank entry not in cash ( only  up to Rs.20,000/- is permisible in cash ) .

 
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