{"id":3914,"date":"2021-03-23T06:43:59","date_gmt":"2021-03-23T06:43:59","guid":{"rendered":"https:\/\/www.jisort.com\/?p=3914"},"modified":"2023-12-20T09:34:39","modified_gmt":"2023-12-20T09:34:39","slug":"is-money-lending-business-legal-in-india","status":"publish","type":"post","link":"https:\/\/jisort.com\/blog\/is-money-lending-business-legal-in-india\/","title":{"rendered":"Is Money Lending Business Legal In India"},"content":{"rendered":"\n

India the second-most populous country in South Asia. India is the best business hub for money lending. Let\u2019s talk about is money lending business legal in India.<\/p>\n\n\n\n

Being populous it is a tourist hub. Setting up<\/a> a lending business can boom fast and easily. However, one needs plans and strategies.<\/p>\n\n\n\n

Money is a scarce resource and everyone needs it. Banks at times take time before granting loans that\u2019s where money lenders come in.<\/p>\n\n\n\n

What is money lending?<\/strong><\/h3>\n\n\n\n

It is the transaction between two or more parties with an agreement; the lender who gives money and other assets and the borrower who receives the money and assets.<\/p>\n\n\n\n

This two-way transaction however has to be agreed upon through terms and conditions. The lender sets terms of lending.<\/p>\n\n\n\n

However, the lender expects the money and assets back in with extra. This means an interest that is accepted on the terms and conditions.<\/p>\n\n\n\n

Types of money lenders<\/strong><\/h3>\n\n\n\n
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  1. Peer to peer lending<\/strong><\/li>\n<\/ol>\n\n\n\n

    This type of lending occurs online and can be governed by a system like Jisort<\/a>. This means that all transactions are monitored and stored safely.<\/p>\n\n\n\n

    This type of system connects lenders to borrowers. This type of lending is legal and is governed by law authorities.<\/p>\n\n\n\n

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    1. Crowd Funding<\/strong><\/li>\n<\/ol>\n\n\n\n

      A digital world site that connects people who need money to people who have money.<\/p>\n\n\n\n

      However, unlike other types of funding doesn\u2019t guarantee all money back instead; the borrower gives perks.<\/p>\n\n\n\n

      One can donate towards a movie studio project and in return, they receive new copies of movies.<\/p>\n\n\n\n

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      1. Friends and Family<\/strong><\/li>\n<\/ol>\n\n\n\n

        They are the best to borrow from. However one also needs to be careful when transacting with them. <\/p>\n\n\n\n

        The Jisort system can help one manage this type of funding. Jisort will monitor and keep all transactions safe, it will also keep reminding the borrower of the due date.<\/p>\n\n\n\n

        Factors to consider when finding a lender <\/strong><\/h3>\n\n\n\n
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        1. The amount of loan<\/strong><\/li>\n<\/ol>\n\n\n\n

          Of course this important because different lenders have different plans. For small loans, friends and family are the best.<\/p>\n\n\n\n

          When it comes to large sums of money, banks are the best for they offer good rates and flexible payment plans.<\/p>\n\n\n\n

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          1. Where to use the loan<\/strong><\/li>\n<\/ol>\n\n\n\n

            Well, a loan should be an investment; don\u2019t just get a loan and use the cash for enjoyment. Utilize it to help you when paying for it.<\/p>\n\n\n\n

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            1. Pledged assets<\/strong><\/li>\n<\/ol>\n\n\n\n

              Most lenders especially when giving a lump sum require collateral. This means pledging your valuables for the loan to guarantee you will pay.<\/p>\n\n\n\n

              In case of default, the lender can sell the collateral to get the money you owe them.<\/p>\n\n\n\n

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              1. Repayment plans<\/strong><\/li>\n<\/ol>\n\n\n\n

                This is the duration period. It is different for different loan amounts. Choose a lender who gives you a flexible plan. <\/p>\n\n\n\n

                It helps one plan and knows how to repay and when. Besides, with repayment plans, one can focus on how to invest.<\/p>\n\n\n\n

                How profitable is money lending business<\/strong><\/h3>\n\n\n\n

                It is lucrative. People are making money just by lending<\/a> money. People want to borrow money flexibly.<\/p>\n\n\n\n

                Besides, at times banks ask for a lot of information and also take time to approve loan<\/a> requests. Nowadays people are preferring lenders to banks.<\/p>\n\n\n\n

                How to start a money lending business in India<\/strong><\/h3>\n\n\n\n
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                1. Create a business name <\/li>\n\n\n\n
                2. Business Plan<\/li>\n\n\n\n
                3. Find fund<\/li>\n\n\n\n
                4. Register your business<\/li>\n<\/ol>\n\n\n\n

                  Above are but a few mentioned plans. For a more in-depth context make sure to read this article.<\/a><\/p>\n\n\n\n

                  Is money lending business legal in India<\/strong><\/h2>\n\n\n\n

                  Yes, however one ought to have registered the business under Section 8 of the Companies Act. <\/p>\n\n\n\n

                  The supervising and regulatory authority (RBI) is the registrar. They have the following guidelines:<\/p>\n\n\n\n