Overseas company loan in India | | | India is one of the fastest-growing economies in the world. Naturally, overseas companies want to invest, expand, manufacture, build, trade, or acquire assets here.
But when it comes to raising funds in India, most foreign companies hit a hard wall.
India banks and NBFCs do not directly lend to overseas companies due to:
- RBI and FEMA restrictions
- Jurisdictional risk
- Enforcement challenges
- Currency exposure
So the big question remains:
How can an overseas company legally, practically, and safely get a loan in India?
The answer lies in a well-structured, RBI-compliant funding model that combines:
- An Indian subsidiary, and
- Indian third-party collateral, funded by NBFCs or private lenders.
This blog explains the exact solution, end-to-end.
Understanding the Legal Reality: Can an Overseas Company Take a Loan in India?
The Direct Route: ❌ Not Allowed
An overseas company cannot directly borrow from:
- Indian banks
- Indian NBFCs
- Indian private lenders
unless RBI gives special approval (which is extremely rare).
The Only Practical & Proven Solution
✅ Indian Subsidiary + NBFC Funding + Indian Third-Party Collateral
This is the most accepted, most funded, and most scalable structure in India today.
Step 1: Setting Up an Indian Subsidiary
The overseas company incorporates:
- A Private Limited Company or LLP in India
- 100% foreign ownership (in permitted sectors)
Why this step is critical:
- The Indian subsidiary becomes a domestic borrower
- FEMA restrictions disappear
- Indian lenders feel legally secure
Step 2: Choosing NBFC / Private Finance Instead of Banks
banks in india are conservative. NBFCs and private lenders are:
- Asset-focused
- Faster
- Structurally flexible
They are ideal for:
- New subsidiaries
- Project funding
- Asset-backed loans
Step 3: Infusing Indian Third-Party Collateral (Game Changer)
This is where most overseas companies win approval.
What is third-party collateral?
Collateral provided by:
- An Indian individual
- Indian company
- Indian asset owner
for a loan taken by the Indian subsidiary.
Acceptable Collateral Types:
- Residential property
- Commercial buildings
- Industrial land
- Warehouses
- Unsold real estate inventory
📌 The borrower and collateral owner can be different entities — fully legal.
Why Lenders Love Indian Third-Party Collateral
- Asset is located in India
- Enforceable under Indian law
- SARFAESI protection
- Zero foreign enforcement risk
This dramatically improves:
- Approval chances
- Loan size
- Interest rate
- Disbursement speed
Legal & Regulatory Compliance (Why This Works)
RBI / FEMA
✔ Borrower is Indian
* Lender is Indian
✔ Collateral is Indian
* No ECB
# No RBI approval required
Companies Act
✔ Third-party guarantees allowed
✔ Shareholder & board approvals
Typical Loan Structure (Real World)
| Parameter | Details |
|---|---|
| Loan Amount | ₹5 Cr – ₹300+ Cr |
| LTV | 50%–65% |
| Interest | 11.5%–18% |
| Tenure | 3–15 years |
| Disbursement | 30–60 days |
Where This Structure Is Commonly Used
- Real estate projects
- Manufacturing plants
- Warehousing & logistics
- Hospitals & education
- Infrastructure
- Import-export businesses
Key Documents Required
Indian Subsidiary
- COI, MOA, AOA
- Business plan
- Financial projections
Overseas Parent
- Audited financials
- Net worth certificate
- Corporate guarantee (optional)
Third-Party Collateral Owner
- Title deeds
- Chain documents
- Encumbrance certificate
- Consent affidavit
Risks (And How They Are Managed)
| Risk | Mitigation |
|---|---|
| New subsidiary | Strong collateral |
| Third-party dispute | Registered mortgage |
| High interest | Step-down clause |
| Exit risk | Prepayment-friendly lender |
The Most Important Question: Who Can Actually Execute This?
This structure looks simple on paper—but execution is everything.
It requires:
- RBI & FEMA understanding
- NBFC & private lender access
- Legal structuring expertise
- Cross-border coordination
- Title & risk management
Why Manjeet Singh Sandhu Is the Only Trusted Expert for This in India
Manjeet Singh Sandhu is currently the only highly experienced professional in India who:
✔ Works end-to-end (structure → approval → disbursement)
* Handles overseas clients directly
✔ Arranges loans on Indian third-party collateral
* Has access to private banks, NBFCs, international lenders
# Structures legally bulletproof transactions
He has successfully assisted:
- Overseas promoters
- Foreign developers
- International manufacturers
- Global investors
to raise ₹10 Cr to ₹300+ Cr in India.
End-to-End Services Provided
- Indian subsidiary setup
- Loan structuring
- Collateral validation
- NBFC negotiation
- Legal documentation
- Disbursement management
Final Verdict
Yes, an overseas company can get a loan in India—if structured correctly.
The Indian subsidiary + NBFC funding + Indian third-party collateral model is:
- Legal
- RBI-safe
- Scalable
- Actively funded
And with the right expert, it becomes smooth and predictable.
📞 CONTACT (Must Appear Exactly Like This)
📞 CONTACT
Manjeet Singh Sandhu
📞 Call / WhatsApp: 8700237256 | 9811993953
📧 Email: manjeetsinghsandhu@zohomail.com
🌍 Pan-India & International Professional Services
❓ 30 SEO-FRIENDLY FAQs
- Can an overseas company directly take a loan in India?
- Is RBI approval required for foreign company loans in India?
- What is the safest way for a foreign company to raise funds in India?
- Can Indian property be used as collateral for foreign companies?
- What is third-party collateral in India?
- Can NBFCs lend to Indian subsidiaries of foreign companies?
- What is the maximum loan amount possible?
- What interest rate applies to NBFC loans?
- Is ECB better than NBFC funding?
- How long does disbursement take?
- Can family property be used as collateral?
- Is FEMA involved in this structure?
- What documents are needed?
- Are personal guarantees required?
- Can startups use this method?
- Can real estate projects be funded?
- Is SARFAESI applicable?
- Are bank loans possible later?
- Can collateral be released early?
- Can NRIs provide collateral?
- Is LLP structure allowed?
- What if subsidiary is newly formed?
- Are cash flows mandatory?
- Can overseas parent give guarantee?
- What cities get better funding terms?
- Can this be used for acquisitions?
- Is tax impact involved?
- Is this structure scalable?
- Who handles lender negotiations?
- Why choose Manjeet Singh Sandhu?