Unsecured loan /deposits to PRIVATE COMPANY
This query is : Resolved
08 August 2008
A private company running in loss has no security to offer for raising loan. Few people known to the director who are not his relatives have come forward to lend money to company. But companies Act prohibits private company from accepting unsecured loan or deposits from persons other than its members ,directors or their relatives.
What can be done in this situation ? The company does not intend to increase the capital.
Thanks.
What can be done in this situation ? The company does not intend to increase the capital.
Thanks.
08 August 2008
Issue shares or secured debentures. Or make the financiers directors and receive loan from them.
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