CROWD FUNDING IN INDIAN CONTEXT
JOURNAL ON CONTEMPORARY ISSUES OF LAW
Crowd sourced funding is a means of raising money for a creative project (for instance, music, film, book publication), a benevolent or public-interest cause (for instance, a community based social or cooperative initiative) or a business venture, through small financial contributions from persons who may number in the hundreds or thousands. Through this paper, we would like to study the concept of crowdfunding and its various facets, how it can be made applicable and to test the extent of
... the extent of validity in India. The research covers how crowdfunding can be extended to macro financing services and not just pertaining to micro financing. We would try to portray how crowdfunding can be used as a source of finance and reducing the dependence on banks and other sources of credit. The different forms or types of crowdfunding that exist today in the world will be recommended so that can be put to use in the future. The benefit that an individual investor and the country as a whole gets from this means of raising money will also be discussed. Subsequently the risk involved in such investment will also be highlighted in this paper. The present Companies Act, SEBI Act and the Securities Act of the country have been taken into consideration, so that flaws in the existing provision will not in any way hamper or come in conflict with idea of Crowdfunding. We would explain the legislation that has been put forward by the US Government called the JOBS Act which has an exclusive chapter on the matter relating to crowdfunding. In the conclusion; we would like to raise the need for stringent laws in place for regulating crowdfunding in India.