Amendment status not verified — confirm the current text below against the official source.
Repeal and savings. * * * * STATEMENT OF OBJECTS AND REASONS I Act 12 of 1962.- At present five different Acts are in force on money-lenders and money-lending in different regions of the State. These Acts are not equal in scope. It has become necessary to have an Act applicable to the entire State and with sufficient provisions not only to regulate and control the money-lending transactions effections effectively but to afford sufficient protection to innocent debtors. The Mysore Money- lenders Bill, 1958 seeks to achieve this object. Some of the main features of the Bill are:- (i) licensing of money-lenders; (ii) requiring money-lenders to keep and furnish prescribed accounts; (iii) empowering of courts to direct payment of decretal amount by installments; (iv) loans to or by a bank, by a co-operative society, insurance company, local authority authorised by Government and other types of loans specified in clause 2(9) are excluded from the purview of the Act. (Published in the Karnataka Gazette (Extraordinary) Part IV-2A dated 26th March 1959) II Amending Act 77 of 1976.—With a view to further restricting the usurious practices of money lending it has become imperative to plug certain inadequacies in the existing Act, and also to provide the Executive Officers with sufficient powers to enforce the provisions of the Act, besides providing deterrent penalties for the infringement of the Act. Accordingly the present facility available under section 11 of the Act enabling Courts to give permission to unlicenced money lenders to obtain licences and thereafter to proceed with their suits for the recovery of dues is now done away with under the amended provisions. Secondly section 15 has been substituted empowering the authorised officers under the Act to enter the premises where the business of money lending is carried on and to call upon the money lenders to produce the required records and if need be to search the premises and seize any record and documents as may be necessary. Thirdly the penalties under the Act have been enhanced both by way of fine and imprisonment to create a deterrent impact on the undesirable money lending practices. Hence the Bill. (Obtained from L.A. Bill No.59 of 1976) III Amending Act 41 of 1985.—The persons who borrow money from the licensed money lenders pledge costly gold ornaments and other articles with them. To safeguard the interests of these borrowers it is proposed to insist on a security deposit in a Government Treasury from such licensed money lenders, and to make a security deposit a condition precendent for granting license in future. In view of the voluminous work in the Administration of the Act, it is also proposed to increase the license fee. As the matter was very urgent, the Karnataka Money Lenders (Amendment) Ordinance, 1985 (Karnataka Ordinance No. 11 of 1985) was issued. This Bill seeks to replace the said ordinance. (Published in the Karnataka Gazette (Extraordinary) Part IV-2A, dated 25th July 1985 as No. 399 at page. 6.) IV Amending Act 2 of 1987.—It is considered necessary to exclude certain Banking and financial institutions from the purview of the definition of the Money Lender under the Karnataka Money Lenders Act, 1961. The existing provisions of the Act provide for the licensee to maintain his books of accounts in any recognised language. It is proposed to make it obligatory to keep such accounts either in Kannada or in English language. For the above purpose an Ordinance was promulgated. This Bill seeks to replace the said Ordinance. (Published in the Karnataka Gazette (Extraordinary) Part IV-2A, dated 4th February 1987 as No. 97 at page 4.) V Amending Act 14 of 1998.—It is considered necessary to amend the Karnataka Money Lenders Act, 1961 (Karnataka Act 12 of 1962) for the following reasons, namely:— (i) to enhance the period of licence from one year to five years; (ii) to enhance the licence fee from Rs. 100-00 per year to Rs. 5000.00 for the term of licence. (iii) to enhance the licence fee for additional place of business from Rs. 50.00 per year to Rs. 2500.00 for the term of licence; (iv) to provide for refund of security deposit in the event to cancellation of licence. (v) since, the Karnataka High Court in Writ Petition No. 8912/85 and other connected matters directed the Government to pay interest on security deposit as there is no specific provision prohibiting payment of interest, appropriate provisions are made to remove the lacuna retrospectively from 31st May 1985, and to validate the action. Hence the Bill. (Obtained from file SAMVYASHAE 19 SHASANA 94.) VI Amending Act 12 of 2021.- It is considered necessary to amend sections 38 and 39 of the Karnataka Money Lenders Act, 1961(Karnataka Act 12 of 1962) to enhance the penalty amount and conviction term in order to ensure strict adherence to the provisions of the Act. Hence, the Bill. [L.A. Bill No. 14 of 2021, File No. Samvyashae 11 Shasana 2021] [Entry 30 of List II of the Seventh Schedule to the Constitution of India.] [Published in Karnataka Gazette Extra-ordinary No. 305 in part-IVA dated: 26.03.2021] VII Amendment Act 16 of 2025:- It is considered necessary to amend the Karnataka Money Lenders Act, 1961 (Karnataka Act 12 of 1962) to protect economically vulnerable groups and individuals from the undue hardship usurious interests rates and coercive means of recovery by licensed money lender and unlicensed money lender. Hence, the Bill [L.A. Bill No. 04 of 2025, File No. SAMVYASHAE 05 SHASANA 2025] [Entry 30 of List II of the Seventh Schedule to the Constitution of India.] [Published in Karnataka Gazette Extra-ordinary No.192 in part-IVA dated: 25.03.2025] 1[KARNATAKA ACT]1 No. 12 OF 1962 (First published in the 1[Karnataka Gazette]1 on the Twenty-ninth day of March, 1962.) THE 1[KARNATAKA]1 MONEY-LENDERS ACT, 1961. (Received the assent of the President on the Eighth day of March, 1962.) (As amended by Karnataka Acts 77 of 1976, 41 of 1985, 2 of 1987, 14 of 1998, 12 of 2021 and 16 of 2025.) An Act to regulate the transactions of money-lending in the 1[State of Karnataka]1. WHEREAS it is expedient to make better provision for the regulation and control of transactions of money-lending in the 1[State of Karnataka]1; BE it enacted by the 1[Karnataka State]1 Legislature in the Twelfth Year of the Republic of India as follows:—