The Government of Bihar, on May 11, 2026, notified the Bihar Micro Finance Institutions (Regulations of Money Lending and Prevention of Coercive Actions) Act 2026.
The following has been stated:-
•The Bihar Micro Finance Institutions (Regulations of Money Lending and Prevention of Coercive Actions) Act, 2026 regulates microfinance institutions, money lenders, digital lending platforms, and similar entities operating in Bihar.
•The Act applies across the entire state and mandates compulsory registration of all money lending entities, with provisions for online registration, renewal, and maintenance of official registers.
•It exempts banks, NBFCs, cooperative banks, and certain government agencies from lending regulations, but borrower protection and fair recovery provisions still apply to them.
•The law defines key terms such as borrower, lender, coercive actions, digital lending platform, and vulnerable persons, while prohibiting illegal and coercive recovery practices.
•It also imposes transparency obligations requiring lenders to disclose interest rates, loan terms, repayment schedules, and borrower rights in Hindi before loan disbursement.
•Additionally, unregistered lending operations are treated as illegal, and digital lenders must comply with IT security, data protection, and customer safety standards prescribed by the government.
It shall come into force on such date as the State Government may, by notification, appoint.
The detailed notification is given in the document below.
[Notification No.: L.G.-01-07/2026-3663/Leg]
