The state Cabinet on Wednesday approved the AP Micro Finance Institutions (Regulation of Money Lending) Bill.
The Bill will replace the AP Micro Finance Institutions ( Regulation of Money Lending) Ordinance which was issued on October 15.
The Bill provides for Registration of MFIs, failing which, a three-year jail term or Rs 1 lakh in fine will be imposed.
The MFIs must take prior approval from the registration authority to give loans to SHG members which are already linked with bank finance, to prevent giving multiple loans to one member without verifying their capacity.
Attempts to recover the loan through coercion will attract a three year jail term or Rs 1 lakh in fine or both, among others.
The Bill will be introduced in the state Assembly which will be reconvened this month.
The Cabinet also approved the Bill to amend GHMC Act, 1955 for treating creamy layer of BCs to provide quota for electoral office. The proposed amendment will enable quota for BCs in the elective posts in GHMC with applying the creamy layer principle.
With a view to achieving goals in view of long coast line, the state has proposed to constitute AP maritime board.
The Cabinet decided to introduce the Bill in the next session of the Assembly.