Money Lender License
What is Money Lender License?
A Money Lender is someone who lends small amounts of money at a higher rate of interest. The reason for charging higher rates of interest is that the money lender faces a higher risk of default than normal banks due to various reasons. People who are desperately in need of money but at the same time do not have a bank account, people with bad credit histories and those who can’t get money from friends or relatives approach a money lender for credit facilities.
In India, money lenders are governed by the Money Lenders Act in different states. The Tamil Nadu Government controls the money lending process in accordance with the Money Lenders Act, 1957. It is mandatory for every money lender to have a license. In this article, we look at the procedure for obtaining money lender license.
Why this License is Required?
Even though getting a valid license under the Money Lending Act helps money lenders to carry on business lawfully and have legal recourse against the defaulters, one of the major reasons for non-registration is the ceiling on interest rate. Many lenders are not even aware about the requirement of such registration.
Who can get a Money Lender License?
Sole Proprietorships
Liability Partnerships
Partnership Firms
Trusts
Document Required for Money Lender License
- Form A application form
- Passport size photographs
- Three specimen signatures mentioning the money lenders name or his nominee
Role of Shamkris and Process of Money Lender License
Shamkris adopts a results-oriented approach to compliance with mandatory licence requirements in the organization. A simple and guidance methodology help organisation to achieve licence in a timely manner and cost-effective. Shamkris support 100% in advisory, Guidance, Compliance with respect to license requirements to obtain approval.
The License process described below:
- Advertising for the document required
- Preparation of documents as per application & list of documents.
- Application File
- Inspection by the department if required
- Liaison department
- License issued
- Yearly compliance if applicable
- Renewal when due
Advisory for the document required
Preparation of documents as per application & list of documents.
Application File
Inspection by the department if required
Liason department
License issued
Yearly Compliance if Applicable
Renewal when due
Who can issue the Money Lender License?
FAQ
- Application to the Magistrate Court. …
- Application to the Lagos State Ministry of Home Affairs and Tourism (the” Ministry”) …
- Inspection of the Official Address of the Applicant.