Money lending by individual

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 February 2013 Can an individual lend money to an individual. Can he charge consideration for such lending. If yes, plz specify the maximum rate at which such lending can made Plz provide the format of the loan agreement to be executed for such transactions.

What document shall the lender asks from the borrower to safeguard his own interest in case there is default in repayment of loan or there is a breach of terms of agreement.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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23 July 2013 For money lending business you have to procure a licence from RBI. There is no fixed rate of interest. You should take a blank cheques for the amount of interest and principal separately. The cheques should be undated