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Low Interest Rate Loan to Directors

26 October 2018

in unlisted public company, can director get interest free loan or very low interest rate loan to directors, like 3% or 6% per annum

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3 Replies

Hitesh (Student) (3549 Points)
Replied 26 October 2018

No loan shall be given to director at a rate of interest lower than the prevailing yield of one year, three year, five year or ten year Government Security closest to the tenor of the loan as per sec 186 of companies act..

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Neel Parikh (105 Points)
Replied 29 October 2018

First of all.. you cannot give loans to directors if u are a public company.
(unless it is the routine business to give loans or it was pre decided at the time of appointment as per employment agreement)

PARUL YADAV (finance expet) (93 Points)
Replied 16 July 2024

Directors looking for low-interest rate loans can consider Kotak Mahindra Bank, which offers attractive options tailored to their needs. Kotak Mahindra Bank provides competitive interest rates on personal loans, making it a viable choice for directors seeking financial support. With flexible repayment options and minimal documentation requirements, the process is streamlined and convenient. Directors can leverage these loans for various purposes, such as business expansion, personal expenses, or investments. It's advisable to check the latest interest rates and terms directly with Kotak Mahindra Bank to ensure you get the best possible deal tailored to your financial profile.