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The public are requested not to fall prey to Money Circulation Schemes. The Chain Schemes, Multi-Level Marketing, Network Marketing, Referral Marketing, Direct Marketing with enrolling members, Sponsoring related business and pyramid structure sellings business whatever induces to get money based on joining members into their scheme are nothing but Money Circulation Schemes. These schemes are banned and punishable under the provisions of The Prize Chits and Money Circulation Schemes (Banning) Act, 1978. Beware of such scheme. If any person puts any mental torcher or undue influence to join into the scheme, kindly complain to police.

  

Money Lending Business
in the name of "Micro Finance by Non-Banking Finance Companies"

  • What is the problem?
    1. Charging usurious high interest.
    2. Carrying business without registration under Money Lenders Act
    3. Employing Recovery agents to recover loan amount forcibly and by coercive methods
    4. Targetting the poor men and women in rural areas and looting their hard earned money.
    5. Distroying the Social and Economic Fabric of the Villages.
  • Laws apart from I.P.C.
    1. Andhra Pradesh (Telangana Area) Money Lenders Act, 1349 Fasli.
    2. Andhra Pradesh (Andhra Region Schedule Area) Money Lenders Regulation, 1960.
    3. Interest Act
    4. Usurious Interest Act, 1918.

Interest calculations

  • Example - Calculations for an amount of Rs.10,000/- for a simple interest of 12.5% p.a. to be paid within 50 weeks as per Micro finance companies.
    • General Calculations (Simple Interest = P.N.R / 100):
    As per General Interest Calculations
    Simple interest (PNR/100) Rs.1250/- =10000X12.5/100
    Total to be paid (Principal + Interest) Rs.11,250/- =10000+1250
    Weekly Instalment = total amount / 50 weeks Rs.225/- =11250/50
    Thus out of weekly instalments they collect
    (a)Weekly interest     		Rs.25/- (10,000 X 12.5/100 X 1/50)
    Thus out of weekly instalments they collect
    (b)Weekly Principal amount
    - Other expenses are separately charged (here other charges will be shown separately).     		Rs.200/- (Rs.225/- - Rs.25/-)


As per Bank Interest Calculations
MonthNo. of weeksPrincipal to be paidInterest paidPrincipal paidPercentage of interest
14100001008001
2492001008001.08695652
3484001008001.19047619
4476001008001.31578947
5468001008001.47058824
6460001008001.66666667
7452001008001.92307692
8444001008002.27272727
9436001008002.77777778
10428001008003.57142857
11420001008005
1261200150120012.5
Total50012501000036%


As per Diminishing Interest Calculations
Principal amount per week (50 weeks)Interest paid in flat rate Percentage of Interest paidPrincipal PaidBalance Principal If interest paid is Rs.35/-If interest paid is Rs.45/-If interest paid is Rs.55/-
10000250.25 20098000.350.450.55
9800250.255102042009600 0.357142860.459183670.56122449
9600 250.2604166720094000.36458333 0.468750.57291667
940025 0.2659574520092000.372340430.4787234 0.58510638
9200250.27173913200 90000.380434780.489130430.59782609
9000250.277777782008800 0.388888890.50.61111111
880025 0.2840909120086000.397727270.51136364 0.625
8600250.29069767200 84000.406976740.523255810.63953488
8400250.297619052008200 0.416666670.535714290.6547619
8200 250.3048780520080000.42682927 0.548780490.67073171
800025 0.312520078000.43750.56250.6875
7800250.320512822007600 0.448717950.576923080.70512821
7600 250.3289473720074000.46052632 0.592105260.72368421
740025 0.3378378420072000.472972970.60810811 0.74324324
7200250.34722222200 70000.486111110.6250.76388889
7000250.3571428620068000.5 0.642857140.78571429
680025 0.3676470620066000.514705880.66176471 0.80882353
6600250.37878788200 64000.530303030.681818180.83333333
6400250.39062520062000.546875 0.7031250.859375
620025 0.4032258120060000.564516130.72580645 0.88709677
6000250.41666667200 58000.583333330.750.91666667
5800250.431034482005600 0.603448280.775862070.94827586
5600 250.4464285720054000.625 0.803571430.98214286
540025 0.4629629620052000.648148150.83333333 1.01851852
5200250.48076923200 50000.673076920.865384621.05769231
5000250.520048000.70.9 1.1
4800250.52083333200 46000.729166670.93751.14583333
4600250.543478262004400 0.760869570.978260871.19565217
4400 250.5681818220042000.79545455 1.022727271.25
4200250.5952381 20040000.833333331.071428571.30952381
4000250.62520038000.875 1.1251.375
3800250.65789474 20036000.921052631.184210531.44736842
3600250.694444442003400 0.972222221.251.52777778
340025 0.7352941220032001.029411761.32352941 1.61764706
3200250.78125200 30001.093751.406251.71875
3000 250.8333333320028001.16666667 1.51.83333333
2800250.89285714 20026001.251.607142861.96428571
2600250.961538462002400 1.346153851.730769232.11538462
2400 251.0416666720022001.45833333 1.8752.29166667
2200251.13636364 20020001.590909092.045454552.5
2000251.2520018001.75 2.252.75
1800251.38888889 20016001.944444442.53.05555556
1600251.562520014002.1875 2.81253.4375
1400251.78571429 20012002.53.214285713.92857143
1200252.083333332001000 2.916666673.754.58333333
100025 2.52008003.54.55.5
800253.1252006004.375 5.6256.875
600254.16666667 2004005.833333337.59.16666667
400256.252002008.75 11.2513.75
2002512.5200 017.522.527.5
Totals 125056%10000079%101% 124%
  • In diminishing balance = if Flat Interest is said (1) Rs.25/- (12.5%) = Actual interest rate is 56% (2) Rs.35/- (17.5%) = 79% (3) Rs.45/- (22.5%) = 101% (4) Rs.55/- (27.5%) = 124%