Legal Question in Banking Law in India
Hi,
I am an entrepreneur looking to set up a bill discounting platform where individual investors can provide loans to small companies. The loan is basis assignment of an invoice (receivable) by the company to the individual investor. Would this be considered Factoring under Indian Factoring Regulation 2011 (which states that if a transaction is factoring, only an NBFC can do factoring with RBI License) or would it be a individual contract governed by Contract Law?
Regards,
Madhu
Asked on 6/09/15, 1:35 am
1 Answer from Attorneys
Fca Prashant Chavan
Expert Edge LLP
09.06.2015
Dear Madhu,
You will need RBI approval for setting up this type of business which is governed by the Indian Contract Act.
Regards,
Answered on 6/09/15, 3:48 am
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