{"id":3204,"date":"2021-03-11T06:46:25","date_gmt":"2021-03-11T06:46:25","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=3204"},"modified":"2021-03-11T06:46:29","modified_gmt":"2021-03-11T06:46:29","slug":"documents-required-for-micro-finance-company-registration","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/","title":{"rendered":"What are the Essential Documents Required for Micro Finance Company Registration?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">If\nanyone wants to choose any business model requires registration under the\nappropriate authority. If you wish to establish a manufacturing unit or form a\nfinance company, registration is essential for all business nature. In this\nblog, we discuss the vital documents required for <strong><a href=\"https:\/\/swaritadvisors.com\/microfinance-company-registration\" class=\"text-primary\">Micro\nFinance Company Registration<\/a><\/strong>. Micro Finance Company is the single-stop\ndestination for the poor and unemployed individuals searching for financial aid\nwithout any security. Individuals are interested in setting up this business\nmodel to go through a suggested registration procedure that attracts plenty of\ndocumentation. Microfinance companies can be formed in two different ways:<\/p>\n\n\n\n<ul><li>NBFC governed by the RBI regulation.<\/li><li>Section 8 Companies regulated by the Companies\nAct, 2013.<\/li><\/ul>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a37ab1550430\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a37ab1550430\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Features_of_Micro_Finance_Company\" title=\"Features of Micro Finance Company\">Features of Micro Finance Company<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#What_is_the_Eligibility_Criteria_for_Micro_Finance_Company_Registration\" title=\"What is the Eligibility Criteria for Micro Finance Company Registration?\">What is the Eligibility Criteria for Micro Finance Company Registration?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Microfinance_institution_as_a_Section_8_Company\" title=\"Microfinance institution as a Section 8 Company\">Microfinance institution as a Section 8 Company<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Microfinance_institution_is_an_NBFC\" title=\"Microfinance institution is an NBFC\">Microfinance institution is an NBFC<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Documents_required_for_Micro_Finance_Company_Registration_as_NBFC\" title=\"Documents required for Micro Finance Company Registration as NBFC\">Documents required for Micro Finance Company Registration as NBFC<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Documents_required_for_Micro_Finance_Company_Registration_as_Section_8_Company\" title=\"Documents required for Micro Finance Company Registration as Section 8\nCompany\">Documents required for Micro Finance Company Registration as Section 8\nCompany<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Some_important_facts_about_Micro_Finance_Companies\" title=\"Some important facts about Micro Finance Companies \">Some important facts about Micro Finance Companies <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/swaritadvisors.com\/blog\/documents-required-for-micro-finance-company-registration\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Features_of_Micro_Finance_Company\"><\/span>Features of Micro Finance Company<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>Microfinance companies must be included as per the <a href=\"https:\/\/en.wikipedia.org\/wiki\/Companies_Act_2013\">Companies Act 2013<\/a>\n     or 1956.<\/li><li>Must obtain the necessary license or permit.<\/li><li>Minimum net worth as suggested by the authority.<\/li><li>Involvement in the low amount of financing to the need\n     one of the society.<\/li><li>To provide some financial support to an individual who\n     works under transportation, carpentry, plumbing, fishing, etc.<\/li><li>Provide access to quality healthcare.<\/li><li>It increases the participation of women in generating\n     sustainable livelihood.<\/li><li>It offers banking assistance at small monetary amounts.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Eligibility_Criteria_for_Micro_Finance_Company_Registration\"><\/span>What is the Eligibility Criteria for Micro Finance Company Registration?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Microfinance_institution_as_a_Section_8_Company\"><\/span>Microfinance institution as a Section 8 Company<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>The limit of loan for Microfinance institutions\nunder <strong><a href=\"https:\/\/swaritadvisors.com\/section-8-company-registration\" class=\"text-primary\">Section 8\nCompany<\/a><\/strong> is up to Rs. 50,000.<\/li><li>The number of members is two.<\/li><li>There is no minimum net worth or NOF (Net Owned\nFunds) that have to be maintained by the microfinance companies.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Microfinance_institution_is_an_NBFC\"><\/span>Microfinance institution is an NBFC<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>The minimum experience of the directors in the\nfield of finance is for ten years. <\/li><li>Prior approval is mandatory from the RBI.<\/li><li>The minimum net worth or net owned funds of the\nmicrofinance institution is Rs 50 Crores.<\/li><li>For a private company, members&#8217; requirement is\ntwo, and for a public company- a minimum of seven members.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Documents_required_for_Micro_Finance_Company_Registration_as_NBFC\"><\/span>Documents required for Micro Finance Company Registration as NBFC<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>NBFC or\nNon-Banking Financial Company business model is more of a legitimate version of\nthe financial company as most third-party lenders are regarded as Non-Banking\nFinancial Companies. If you want to choose this business model to start a\nmicrofinance company, you need to submit all the documents required for Micro\nFinance Company Registration as <strong><a href=\"https:\/\/swaritadvisors.com\/nbfc-registration\" class=\"text-primary\">NBFC<\/a><\/strong>.<\/p>\n\n\n\n<ul><li>Submit a copy of the board resolution generated\nduring the AGM in the presence of the board members.<\/li><li>Submit fixed deposit receipt issued by the bank.<\/li><li>Submit a copy of MOA (Memorandum of Association)\nshowing the goal, identity, and work methodologies of the\ncompany.<\/li><li>Submit Certificate of Incorporation issued by\nMCA (Ministry of Corporate Affairs).<\/li><li>No Lien Certificate declaring details of NOF or\nNet Owned Fund issued by the bank.<\/li><li>KYC (Know Your Customer) of the present\ndirector.<\/li><li>Submit a copy of AOA (Articles of Association)\ncontaining the rule, management, internal working, and hierarchical information\nof the company.<\/li><li>Submit the net worth certificate of the director\ncertified by a CA (Chartered Accountant).<\/li><li>Submit any professional proof and academic qualification\nproof of the directors.<\/li><li>Submit any income proof of the director, such as\n<strong><a href=\"https:\/\/swaritadvisors.com\/income-tax-return-filing\" class=\"text-primary\">Income Tax Return<\/a><\/strong>\n(ITR) receipt or bank statement.<\/li><li>Document showing working experience of the\ncurrent directors in the financial sector.<\/li><li>Structure plan of the business where applicants\nplanned to conduct the business activities.<\/li><li>The current credit report of directors issued by\nparticular bank showing present credit information.<\/li><li>Submit a confidential report of the banker\nbriefly describing the track record of the company related to banking\nactivities.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Documents_required_for_Micro_Finance_Company_Registration_as_Section_8_Company\"><\/span>Documents required for Micro Finance Company Registration as Section 8\nCompany<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In this\ncase, if any individual wants to establish a microfinance company under the\nshade of Section 8 of the Companies Act, 2013, but for that, you need to submit\nthe following documents required for Micro Finance Company Registration as\nSection 8 Company.<\/p>\n\n\n\n<ul><li>Submit a copy of PAN Card of all the directors\nof the company.<\/li><li>Documents regarding the identification and\naddress proof of the core members of the establishments, i.e. promoters and\ndirectors.<\/li><li>Submit Rental Agreement, Lease Deed, Ownership\ndocuments of the property.<\/li><li>In the case of the rented office, submit a NOC\nor No Objection Certificate issued by the owner.<\/li><li>Applicable stamp duty as directed by the state.<\/li><li>In some case, you may need to submit additional\ndocuments.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Some_important_facts_about_Micro_Finance_Companies\"><\/span>Some important facts about Micro Finance Companies <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>Department of Revenue is responsible for the issuance of a corporate lien certificate, and it shows the liabilities of the companies in the context of corporate tax.<\/li><li>Under the business model of Non-Banking Financial Company, the applicant must furnish a copy of Memorandum of Association (MOA), Articles of Association (AOA) and Board Resolution as a part of the documentation for Micro Finance Registration.<\/li><li>Micro Finance Companies facilitate rural employment at a larger scale.<\/li><li>Most of the financial lending services at microfinance companies are collateral-free.<\/li><li>The rate of interest could be strict as compared to other financial organizations.<\/li><li>These companies could generate noteworthy employment.<\/li><li>They have large loan portfolios with undercover conditions that are spiteful in nature.<\/li><li>Usually, these companies provide low repayment rates when contrasted with trading lending companies.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p> It&#8217;s now clear that registering a microfinance company has a more accessible process; however, you are advised to take the assistance of a professional before proceeding. You must take into consideration all the facts and make a wise decision. The above-mentioned list of documents required for Micro Finance Company registration should be kept ready for sailing through the process.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/start-a-micro-finance-institution\/\">How to Start a Micro Finance Institution in India?<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>If anyone wants to choose any business model requires registration under the appropriate authority. If you wish to establish a manufacturing unit or form a finance company, registration is essential for all business nature. In this blog, we discuss the vital documents required for Micro Finance Company Registration. Micro Finance Company is the single-stop destination [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":3206,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[59,56],"tags":[482],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3204"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=3204"}],"version-history":[{"count":5,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3204\/revisions"}],"predecessor-version":[{"id":3212,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3204\/revisions\/3212"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/3206"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=3204"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=3204"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=3204"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}