The department of company affairs (DCA) today reduced the maximum interest that can be offered by manufacturing companies on public deposits by one per cent to 14 per cent. The maximum interest rate is now on par with that offered by non-banking finance companies.
The department has issued a notification amending the Compa-nies (Acceptance of Deposits) Rules, 1975, in consultation with the Reserve Bank of India under Section 58A read with Section 642 of the Companies Act, 1956, an official statement said.
Industry sources said that only the lesser known companies will be affected by the DCA notification, since most corporates offer interest rates between 10-12 per cent on public deposits.
Ballarpur Industries, for instance, offers 11 per cent interest on a one-year deposit, 11.5 per cent on a two-year deposit and 12 per cent on a three-year deposit.
