Loan from NRI Director

[Pawan Kumar]

Hi Members,

Can a NRI Director give loan to the company from his NRE account in INR? Does FEMA or RBI guidelines apply and can the same be converted into equity shares at later stage?

Regards,

Pawan Kumar Ramachandra

[santhosh kumar]

U can take loan from director as per act. But to convert to equity u should take prior approval of members. Since it's in INR...to this extent iam sure.
Rest FEMA  needs to check once

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[Pawan Kumar]

Thank you santhosh.

For availing loan should the rate of interest be at market rate?

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Regards,

Pawan kumar R


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[R V Seckar]

Hi,

Please take a letter from NRI that the loan is not an ECB and to be repaid in iNR along with interest and to be credited to his NRO account. Then , no FEMA or ECB formalities are involved.

Regards

R.V.Seckar

Mobile- 09848915177

Pl do visit my blogs :

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[Pawan Kumar]

Hi,

Can the loan amount be credited to NRE account? or should it be NRO account in specific? 

[R V Seckar]

NRO

[santhosh kumar]

Rate of interest is not less than prevailing bank rate

[Himanshu Nadiyana]

Dear Seckarji and Santhoshji,

Whether it is mandatory to pay interest on loan obtained from Director / Member (whether NRI or not) and
if yes, under which regulations i.e Companies Act, 2013 or FEMA

Thanks & Regards,

Himanshu Nadiyana

M: 92274 58638

[kavita goel]

Dear Professional

Can any body help me to advice whether the NRI Director (also the promoter and the shareholder of , software development co.) give loan to such Company  (private limited , incorporated in India).having Paid share capital Rs 100000.

 

Company just started the business (with revenue), for  payment of salary , Rent and other petty expenses the director used his own NRO A/c

Till date he spent approx 16,00,000/-

Is it permissible?

 He never took any approval from RBI and not submitted any form with any authority for such expense.

Please suggest its  Urgent.

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Regards:
CS Kavita Goel
9560266544

Delhi

[Rima Joshi]

Dear kavita

Company cannot accept loan or deposit from any NRI whimsoever it may be director or shareholder

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[R V Seckar]

Yes . An NRI can lend from his NRO account and you get an undertaking from him that he will seek repatriation of interest and principal account. Both interest and principal payment can be repaid to his NRO account or current account in India and not to his NRE account.

Regards

[Rima Joshi]

Yes I agree with seckar

[Rima Joshi]

Sorry I agree with seckarji

[R V Seckar]

Hello Rimaji,

No formalities. You are welcome

[kavita goel]

Thanks a lot every one

[CS Manish Chopra]

R V Seckar Sir, please provide that circular etc. where it's mentioned that NRI director can give loan to Indian pvt. Co.

In case of any query feel free to revert.

Thanks & Regards

CS Manish Chopra
97802-98898

Website: https://sites.google.com/site/csmanishchoprachandigarh/

[Vijay]

Dear Sir,

The NRI Director has already lent to the Company from his NRE Account in 2016 and no declaration was taken.

Can a back dated deceleration be taken declaring that he would seek the lent amount only to his NRO account and would that suffice for the compliance.



Thanks

[sudheer]

Dear R V Seckar,

 

Greetings!

 

My Question is Company can take Loan from Director relative who is NRI,  from his NRO or NRE account.

 

Regards

sudheer