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ARTICLE · 18 SEPTEMBER 2020

Ministry Eases Deposit Rules For Start-Ups-India

S.S. Rana & Co.
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The amendment easing out deposit and repayment rules by Start-Ups is a welcome move.

IndiaCorporate/Commercial Law
S.S. Rana & Co. Advocates
S.S. Rana & Co. Advocates
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The Ministry of Corporate affairs (MCA) in consultation with the Reserve Bank of India (RBI) has issued a notification dated September 07, 2020, amending the Companies (Acceptance of Deposit) Rules, 20141 , in order to provide more flexibility to Start-Ups to raise funds, especially during the pandemic.

Also read Start-Up Funding in India

Key Highlights of Companies (Acceptance of Deposits) Amendment Rules, 2020

1).MCA amended the Companies (Acceptance of Deposits) Rules, 2014 to enable start-ups to raise funds through corporate bonds or other convertible instruments for "ten years", as against the stipulated period of "five years" earlier;

2). Changes made in period of repayments: The period of repayment has also been changed from "five years" to "ten years".

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