- Microfinance Company Registration
- How to Start the Microfinance Company Registration?
- Privileges of Microfinance Company Registration
- Top Microfinance Companies registered in India
- Microfinance Company Registration: Legal Structure types
- Procedure for Microfinance Company Registration in India
- Step 1: Register a Company
- Step 2: 2 crores raised to authorized and paid-up capital
- Step 3: Deposit Rs. 2 crores in Fixed Deposit and receive Certificate
- Step 4: Take all the certified Copies and fulfil the essential checklist for RBI registration
- Step 5: Fill the online application
- Step 6: Present the Hard Copy to the Regional Office of RBI office
- Documents Required for Microfinance Company Registration
The means m of a can broadly be classified into 2 sections:
- Registration of a new public limited company
- Permission from RBI for business operation as a microfinance company.
Microfinance companies are the financial institutions that give small-scale financial services in the form of savings, loans, and credit. Microfinance Company is also known as a Micro Finance Institution. It is a kind of non – deposit acquiring NBFC. For NBFC registration you can visit our website legalraasta. It gives small financial assistance to people with low income and in rural and semi-urban areas.
Micro Finance Companies are suitable to give a loan or credit of approx. Rs 50,000 in a rural area and Rs. 1,25,000 in urban areas to people with the low-income group and small entrepreneurs. Without charging any marginal money or guarantee security. It can give loans at inexpensive rates directed by the RBI and central government. They are a big support to rural and agricultural development plus income and employment creation.
How to Start the Microfinance Company Registration?
Anyone who wants to register a Microfinance company requires to register a company first under the Companies Act, 2013. Once the company is registered and you have received certificates of incorporation under the Companies Act, 2013 you require to open a bank account in the name of the company and deposit a number of Rs.2-5cores as fixed deposit in the account.
After depositing the amount of fixed deposit you require to create a proper application to RBI in the directed format for NBFC – MFI Registration, along with all the detailed documents. The application will be filed online and hard copies of all documents will be presented to the regional office of RBI. After getting the application and all the essential documents the RBI will handle due application. If the bank is convinced with the application and the documents, it will pass on the Certificates of the starting business to the Microfinance company.
Privileges of Microfinance Company Registration
For Microfinance Institutions in India, RBI has formed a policy structure in order to render assured legitimacy. Here are the following privileges of Microfinance company registration :
- It benefits in fostering self-reliance and entrepreneurship.
- Constant and smooth access to funding.
- High-grade overall loan repayment rate in correlation to traditional banks.
- It assists in increasing the financial condition by reaching the credit requirements of needy people by providing various types of loans contributes important economic profits even if income levels continue to be the same.
Top Microfinance Companies registered in India
- Grameen Financial Services Pvt Ltd (GFSPL)
- Casper Micro Credit (CMC)
- Bhartiya Samruddhi Finance Limited (BSFL)
- Asmitha Microfin Ltd (AML)
- Spandana Sphoorty Financial Ltd (SSFL)
- Share Microfin Limited (SML)
- SKS Microfinance Ltd (SKSMPL)
Microfinance Company Registration: Legal Structure types
Procedure for Microfinance Company Registration in India
The procedure to register a Micro Finance Company is compact as it includes the license and certificate from RBI. Since RBI is included in this process it can take a month to complete it.
Though, the license RBI is so important. So, let us follow the procedure in brief:
Step 1: Register a Company
This is the first step to register the MFI company in India. It can be a public limited company or a private limited company. Moreover, originally, a company can be registered with Rs.1 lakh capital.
This is the next step to boost the share capital with both authorized and Paid up to Rs.2 Crores. This is because to register an NBFC in India, the least net worth needed is Rs.2 crore.
Step 3: Deposit Rs. 2 crores in Fixed Deposit and receive Certificate
After establishing the capital amount, the following step is to put the sum of Rs.2 crore in Fixed Deposit and receive a certificate of no charge from the bank. This shall be added to the application when filed with the RBI.
Step 4: Take all the certified Copies and fulfil the essential checklist for RBI registration
Fulfill the demanded list for RBI registration. The demand for Micro Finance Company Registration is as follows:
- Copy of Board resolution.
- Certified Copies – Certificate of Registration
- MOA linking to the financial business
- Bankers Report for candidate company, association companies.
- A copy of FD receipt & banker’s certificate of charge showing balances in support of NOF.
Step 5: Fill the online application
Fill the online application for NBFC registration as a MIF. Once the online application is registered, the company receives a Company Application Reference Number.
Step 6: Present the Hard Copy to the Regional Office of RBI office
Once the application is filed, a hard copy of the application with all the essential documents are to be transferred to the regional office of the RBI.
Documents Required for Microfinance Company Registration
The following are the essential documents required for all directors and shareholders MIF registration :
- Auditors report concerning receipt of the least net owned fund of the candidate company.
- Banker’s Report
- A certificate of CA concerning details of group, associate, subsidiary or holding companies with the aspects of investments in different NBFCs.
- Board Resolution in connection to the intended Microfinance company registration
- A verified copy of the highest educational and professional qualification of total the recommended directors of a candidate company.
- Rightfully Certified copy of Certificate of Incorporation of a company.
- Verified copy of MOA & AOA of the Company.
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