2 Answers
Promissory note is legal but such rate of interest is against the public policy and it cannot be claimed at 36%. .
Dear Sir,
Under the Andhra Pradesh Money Lenders law, a person carrying on the business of money lending must obtain a licence/registration. A person advancing repeated loans and charging interest as a business practice typically falls within this definition.
Regarding 36% annual interest:
36% p.a. is very likely to be considered exorbitant / usurious compared to typical caps under state money-lending laws (which often tie to bank rates plus a margin, and historically much lower than 36%). LegitQuest
If the state government has not expressly permitted such a rate by notification, charging 36% may be treated as violative of the Money Lenders Act.