What is a Charge? MCA Charges & Borrowings Explained
A charge is a registered security interest filed with MCA, almost always against a lender. We unpack what charges tell you, the difference between open and closed charges, and how to read the charge register.
Whenever an Indian company borrows money against its assets, the loan leaves a fingerprint on the corporate registry. That fingerprint is called a charge - a registered security interest filed with MCA - and it's one of the most useful diligence signals a company can give you for free. Read the charge register on a company and within a minute you'll know whether it's leveraged, who its lenders are, and whether anything has been paid off.
Here's what a charge is, what to look for, and what each row of the charge register actually means.
What a charge is
A charge is a registered security interest a company creates over its assets in favour of a lender or other creditor. Almost every charge represents a loan: the company has borrowed money, and the lender has taken a charge over specific assets - or the company's entire undertaking - to secure repayment. The charge is registered with MCA under Sections 77 to 87 of the Companies Act, 2013, which means it shows up on the company's profile and any future lender, investor or counterparty can read it.
Why charges matter for diligence
For a credit, M&A or vendor team, the charge register answers four questions in seconds. How leveraged is the company? A high count of open charges or a large total charge amount relative to revenue is a clear leverage signal. Who are its lenders? The register names the chargeholders - typically a bank, an NBFC, or sometimes a related party. Concentration on a single bank is normal; a long tail of small private chargees is not. What's still active? Open charges are live; closed ones have been paid off and released. And is there room? If you're about to lend, you want to know whether prior charges have already locked up the company's main assets.
Open versus closed - and what "modified" means
A charge sits in one of three states. Open (or active) means the security interest is live and the lender can still enforce against the secured assets. The company filed Form CHG-1 - or CHG-9 for debentures - within 30 days of creating the charge, and nothing has happened since to release it. Modified means the terms or the amount of the charge have changed without the charge itself being released; the company files Form CHG-1 again with the modification flag. Closed (or satisfied) means the loan has been paid off and the lender has released the security; the company files Form CHG-4 within 30 days of the payoff.
Reading a company's charge register
On Infyner's Charges tab for any company, you'll see four kinds of information at a glance: the headline numbers (count of open charges, count of closed charges, and the total open and closed amounts), the top lenders ranked by exposure, and the per-charge list - charge ID, charge holder name, amount, status, date of creation, and any modification or satisfaction date.
The same data is publicly viewable through MCA's "View Index of Charges" service. The index itself is free; the underlying CHG-1 PDFs cost a small fee to download.
Patterns that should catch your eye
A few patterns are worth flagging when you're vetting a company. Recent open charges from non-bank lenders sometimes signal last-resort financing - banks have stepped back, and the company has had to find capital elsewhere. Multiple charges across the same asset class are a prompt to check inter-creditor priority before you lend into the same pool. An open charge that has clearly been repaid in full but never modified or satisfied is usually a housekeeping issue, not a credit signal - but it tells you the company isn't tight on its compliance hygiene. And a multi-crore-revenue company with no charges at all is either genuinely unleveraged (encouraging) or is being funded entirely off-registry by related parties (worth a question or two).
Charges, mortgages, hypothecation, pledges, liens
In Indian corporate practice, "charge" is the umbrella term for any encumbrance a company creates on its assets. The specific forms underneath have specific names. Mortgage is the form used over immovable property. Hypothecation covers movable assets that stay in the company's possession. Pledge is movable assets handed over to the lender as security. Lien is the right a person has over goods until payment is made. Whatever form the security takes, when a company creates one, MCA wants it filed as a charge.
Common questions
What's the difference between an open and a closed charge?
An open charge is an active security interest - the lender can still enforce against the secured assets. A closed (or satisfied) charge has been paid off and the lender has released the security via Form CHG-4.
Where are charges registered?
With the company's Registrar of Companies, under Section 77 of the Companies Act, 2013. The form is CHG-1, or CHG-9 for debentures, filed within 30 days of the charge being created.
Are charges public information?
The index of charges and the headline data per charge are public - viewable on MCA's portal and aggregated on Infyner. The underlying CHG-1 PDFs require a small paid request through "View Public Documents".
What if a charge isn't registered within 30 days?
The company can still file with up to 60 days extension on additional fees. Beyond that, the company has to apply to the Central Government under Section 87 for condonation of delay. An unregistered charge is void against liquidators and other creditors in winding-up.
Where to go next
For diligence context, see MCA status meaning and CIN. Or pull the charge register on a specific company.