The Banning of Unregulated Deposit Scheme Ordinance checks illicit deposit schemes that dupe investors, without prohibiting schemes regulated by law such as chit funds. It was promulgated to curb the menace of Ponzi schemes and makes unregulated deposit schemes punishable.
The Department of Financial Services clarified that the Ordinance exempts individuals, firms, companies and LLPs taking loans and deposits in the ordinary course of business, under section 2(4)(e), (f) and (l) and other provisions.
We have analysed the provisions of the Ordinance as a set of FAQs.