Limitation on Interest - Maharashtra Money-Lending (Regulation) Ordinance, 2014


(1) The State Government may, from time to time, by notification in the Official Gazette, fix the maximum rates of interest to be charged by a money-lender in respect of secured loan and unsecured loan. 

(2) No money-lender shall receive from a debtor or intending debtor any sum by way of compound interest on a loan advanced or intended to be advanced or any sum by way of interest at a rate higher than the rate fixed under sub-section(1).

(3) Notwithstanding anything contained in any other law for the time being in force, a money-lender shall not charge or recover from any debtor, on account of interest, a sum greater than the amount of principal of loan whether advanced before or after commencement of this Ordinance.

(4) Notwithstanding anything contained in any other law for the time being in force, no agreement between a money-lender and a debtor for payment of interest at rates exceeding the maximum rates fixed by the State Government undersub-section (1) and no agreement in contravention of the provision ofsub-sections (2) and (3) shall be valid.

32.(1) No money-lender shall receive from a debtor or intending debtor any sum other than reasonable costs of investigating title to the property, costs of stamp, registration of documents, and other usual out of pocket expenses in cases where an agreement between the parties includes a stipulation that property is to be given as security or by way of mortgage and where both parties have agreed in writing to such costs and reimbursement thereof or where such cost, charges or expenses are leviable under the provisions of the Transfer of Property Act, 1882, or any other law for the time being in force.

(2) Any sum received by a money-lender in contravention of sub-section (1) from a debtor or intending debtor on account of costs, charges or expenses referred to in that sub-section shall be recoverable from the money-lender as debt due from him to the debtor or, as the case may be, intending debtor, or shall be liable to be set off against the loan actually lent to the debtor or intending debtor.

Ozg Business Resource Center 
Website:  moneylender.co.in
Email: ask@moneylender.co.in