Dear Laxmi;
Employees request for loan. Either short term or long term. It is purely and simply discretion of management. When a loan is given, lender must secure its repayment. If he does not pay sufficient attention to it, employer sufferes.
Short term loan is for a max period of 6 months. It can be against annual bonus. Otherwise not more than 50% of his wages for next 6 months. .
Long term loan is not to be given by employer. It is not his business. He can arrange with a bank, cooperative bank and let the employees get loan from bank. Even if employer gives long loan, it is of a large amount out of which employee is buying some asset, car, house, etc. Company can get that asset mortgaged so that while separating the employee has balance amount to be repaid, the asset is with the company. Company is safe.
Vibhakar Ramtirthkar.