How to get a pawn broker licence in Andhra Pradesh and Telangana

Which law covers you

For a gold-loan shop the certain part is the pawn broker licence, one per shop (section 3). If you also lend on pronotes or cheques without holding gold, Telangana requires the money-lender licence as well; MeeSeva offers both. Whether a pure pledge shop in Telangana needs both is not stated on any official page — ask the Revenue Divisional Officer.

Who issues the licence

For pawn brokers (Rule 3): the District Collector inside the municipal limits of Hyderabad, Vijayawada, Visakhapatnam, Guntur, Warangal and Tirupati, and the Revenue Divisional Officer everywhere else. Appeals go within 30 days to the Chief Commissioner of Land Administration in those cities and to the Collector elsewhere (section 23). Money-lender licences in Telangana come from the revenue officer the government names — the Collector in Hyderabad and the Tahsildar in the districts, per the citizen charter.

Apply through MeeSeva

1. Download Form A for the pawn broker licence — Andhra Pradesh or Telangana — and the money-lending form if you need that licence too.
2. Fill in your name, father’s name, home and shop addresses, the properties you hold, every shop you will run, and the financial year; sign the declaration.
3. Pay the licence fee by challan or demand draft of a nationalised bank (Rule 4) and note the challan number on the form.
4. Submit the form and documents at a MeeSeva centre (“Pawn Broker License” under Revenue services in AP; the Telangana MeeSeva list carries the same service). You get an application number by SMS.
5. The RDO or Collector verifies and issues the licence in Form C. The citizen charter allows 45 days for a fresh licence and 30 for a renewal.

The same form can be handed in at the RDO’s office directly.

Documents to keep ready

The official form asks only for the particulars above and proof of address. Offices commonly ask for:

• Form A, signed, with the fee challan or DD
• Proof of identity and address of the proprietor or partners, and PAN
• Proof of the shop premises (lease deed or ownership) and of the properties declared
• Passport photographs and an affidavit
• Partnership deed or firm registration, if not a proprietorship
• Some centres also ask for a bank statement and a National Savings Certificate of ₹10,000 as security. The 2007 Rules prescribe no security deposit, so ask the RDO what your district actually requires before buying one.

Fees and validity

A Telangana money-lender licence runs one year at a time; its fee in the old Act is a nominal sum, and the charter quotes ₹1,000 — the MeeSeva counter will tell you the figure on the day.

Interest you may charge

A pawn broker may charge no more than 2% a year above the rate commercial banks charge on similar loans (section 7 and Rule 9), and total interest can never exceed the principal. No notification fixes a single number, so document the bank rate you benchmark against. For money-lender licences in Telangana the government notifies ceilings under section 10 of the 1349 F Act; charging above them is an offence. Interest on default is capped at half the contract rate.

What the licence obliges you to do

• Name board with the words “Pawn Broker” and their Telugu equivalent (section 5).
• A pawn ticket for every pledge in Form G (section 8), and the books the Act names: the pledge book (Form F), sale book (Form H) and redemption receipts (Form I) (section 11). Keep sale records for three years.
• Open to inspection by the licensing authority, an inspector, a police officer of sub-inspector rank or above, or the Tahsildar (sections 11, 16 and 17).
• Do not move the shop without notice to the licensing authority and an endorsement on the licence (section 6).
• Take no pledge from a minor or a drunk person (section 25), and never advance less or charge more than the ticket shows (section 24).
• A Telangana money-lender also keeps a separate account for each debtor, gives a receipt for every payment and an annual statement in the local language (sections 5 and 8 of the 1349 F Act).

Unredeemed gold: the auction rules

A pledge can be redeemed for two years from the day it was pawned (section 12); your pawn ticket may allow longer. After that it can be sold only by public auction through an auctioneer approved by the licensing authority (section 13, Rule 20):

1. Public notice describing each article, including its weight, 21 days before the sale, on two successive days in a local newspaper (Rule 16); advertisements in Telugu and English, the second at least ten clear days before the sale.
2. A printed catalogue pasted at the shop and sent a week before by registered post with acknowledgement to the pawner, the licensing authority, the Tahsildar and the police station.
3. Surplus over the loan, interest and costs goes to the pawner within a month; unclaimed surplus is deposited with the licensing authority within seven days.

The broker is liable for pledges lost to fire or spoiled by neglect (sections 14 and 15). Our auction guide shows how the notices and the paper trail fit together.

Pawnbroking without a licence

Running a pawn shop without a licence, advancing less than the ticket says, or charging more, is punished with imprisonment of one to three years and a fine of up to ₹50,000 (sections 24, 28 and 29). Under the Telangana Money Lenders Act an unlicensed lender’s suit is dismissed, and the Andhra Pradesh High Court has applied that even to a bounced cheque.

How software fits in

GoldKhata prints the pawn ticket with the particulars Form G asks for, keeps the pledge book, sale book and redemption receipts as you work, and counts the two-year redemption window and the notice dates for you. Interest is counted at the rate you set — simple or compound, your first-month rule — and the licence number and your terms sit on every pledge bill and notice.

Sources

• Andhra Pradesh Pawn Brokers Act, 2002 and the Telangana adaptation
• Andhra Pradesh Pawn Brokers Rules, 2007
• Telangana Money Lenders Act, 1349 F
• MeeSeva citizen charter — fees and service times

Frequently asked questions