Loans

17.1 Rule 15(4) of the Nidhi Rules, 2014 permits only three kinds of securities against which a Nidhi can give loan to its members, namely:- (a) gold, silver, and jewellery; (b) immovable property and (c) fixed deposits receipts, National Savings Certificates, other Government Securities and insurance policies. A suggestion was received from stakeholders that in case of urban marginal or lower class, vehicles like auto-rickshaw, etc. are sources of income and are available on hypothecation of vehicle itself and no other security is required. Further urban lower class has no immovable property or gold etc. Therefore, it was suggested that vehicles should be allowed as security for hypothecation. The Committee deliberated and did not agree with the suggestion since vehicles are not ejusdem generis i.e. of the same kind as the other assets permitted.

Permitted securities: proposal to accept vehicles as hypothecation rejected because vehicles are not of same kind as listed assets. Rule 15(4) of the Nidhi Rules, 2014 limits permissible loan security to gold, silver and jewellery; immovable property; and specified financial instruments. A proposal to allow income-generating vehicles as hypothecated security for urban lower-income members was considered and rejected because vehicles are not ejusdem generis with the categories listed in the rule.