Menu
Section 8 Micro Finance Company Registration
It is a one stop solution for all kind of Registration or Compliance Requirement.
Our Services
Section 8 Micro Finance Company Registration
A Section 8 microfinance company is an organisation that provides finances, to individuals or groups that do not have access to traditional banking services. These institutions are designed to serve low-income individuals and small businesses that may not be eligible for loans from conventional banks due to a lack of collateral or a poor credit history. Microfinance companies provide small loans, often in the form of microfinance loans, that are designed to meet the needs of these underserved populations. These companies are introduced to ease the credit system for small businesses, as they don’t get a loan from banks due to their complex process. Therefore, it is commonly known as a microcredit or microbenefit organization.
In addition to loans, section 8 microfinance companies also offer business training and support, to help their clients grow their businesses and improve their financial situation. The goal of these institutions is to promote financial inclusion and economic development in underserved communities by providing access to capital and other financial services.
Success Project
+
0
%
Documents required for Microfinance Company Registration
Passport-size photographs.
Copy of the Pan Card
Copy of Identity Proof (Aadhaar Card/Voter Card/Driving Licence/Passport)
Copy of address proof (any latest utility bill or bank statement)
Copy of one address proof for the registered office of the company (any latest utility bill)
NOC/Rent Agreement for using the premises as the registered office of the company
What we offer
Benefits of Microfinance Company Registration
Access to Capital
Access to capital is one of the main benefits of microfinance companies. By providing small loans and other support services to individuals and businesses who might not otherwise have access to traditional banking services, microfinance companies help increase access to capital for those who need it most. This can be particularly important for low-income individuals and small businesses, who might not have the collateral or credit history required to secure a loan from a traditional bank.
Financial Inclusion
Financial inclusion is another key benefit of microfinance company. By providing financial services to people who might otherwise be excluded from the formal financial system, these companies help to promote financial inclusion and reduce poverty. This can be particularly important for low-income individuals and small businesses, who may not have access to traditional banking services or may not be eligible for loans from banks due to their financial situation.
No RBI approval is required
The RBI regulates the finance industry in India. But section 8 microfinance companies are exempt from RBI registration. So they can start business without RBI approval.
Unsecured Loans
Section 8 microfinance companies, have the advantage of being able to provide unsecured loans (personal loans, group loans, etc.) to individuals and small businesses. Unsecured loans, such as personal loans or group loans, can be particularly beneficial for low-income individuals and small businesses who might not have the collateral or credit history required to secure a loan from a traditional bank. By providing unsecured loans, microfinance companies can help increase access to capital for those who need it most, encouraging entrepreneurship and supporting the growth of small businesses.
Job Creation
By providing access to capital, microfinance companies can help create jobs and stimulate economic activity. This can have a positive impact on the local economy and help reduce poverty in the community.
Empowerment of Women
Many microfinance companies target women as their primary clients, helping to empower them and provide them with greater economic opportunities. This can help reduce gender inequality and improve economic outcomes for women and their families.
Improved Livelihoods
By providing access to capital, microfinance companies can help individuals and businesses improve their livelihoods and achieve their financial goals. This can help increase economic activity and reduce poverty in communities.
No area limitation
Like Nidhi companies, Section 8 Micro finance company does not have any working area limitations. They can operate on a pan-India basis.
Frequently Ask Question
A Section 8 microfinance company is a financial institution that provides collateral-free small loans to individuals and small businesses that typically lack access to traditional banking services. Microfinance companies aim to promote financial inclusion and alleviate poverty by providing credit to low-income individuals and communities.
The benefits of a Section 8 microfinance company include financial inclusion, poverty alleviation, women's empowerment, entrepreneurial growth, etc.
There is no such requirement. You can start with Rs. 10,000 also.
The interest rate that a Section 8 microfinance company can charge borrowers is regulated by the Reserve Bank of India (RBI). It can charge up to 26% per year.
Yes, a microfinance company can charge a processing fee for loans given to its borrowers. Processing fees are charges that are levied by financial institutions for the services provided in processing a loan application, such as credit appraisal, documentation, and verification. The maximum processing fee that can be charged by microfinance companies is 1% of the loan amount.
No, a section 8 microfinance company cannot give secured loans. They can give unsecured loans only.
No, a section 8 company cannot accept deposits from the public.
Section 8 micro finance companies are exempt from RBI approval. They are regulated by the Ministry of Corporate Affairs.