OneClick Business Solutions

One Click Business Solutions is one of the leading legal firms in India, that is registered under the Companies Act, 2013 & our Corporate Identity Number is U74999DL2019PTC362211.

Make Your Nidhi Company Registration Quick & Easy

  • Speed Up Your Registration Process.
  • Ensure Compliance With Indian Laws.
  • Keep You Updated On Any Legal Changes.
  • Act As Your Sole Contact For Registration And Upkeep.

Starting from ₹ 8,000/-

Nidhi Company Registration

Nidhi Company Registration

If you’re interested in establishing a Nidhi Company in India, you’re in the perfect spot. Our proficient team can guide you through the entire registration procedure, ensuring a seamless experience. Nidhi Companies are NBFCs tailored to encourage savings among members. With our budget-friendly options and swift registration, initiating your Nidhi Company is a breeze. Reach out to us today to kickstart your journey!

Nidhi companies have a longstanding presence in India, with records from the Ministry of Corporate Affairs (MCA) dating back to as early as 1903, showcasing their incorporation. Their numbers have steadily risen over time, and they have upheld their commitment to offering a “money-back promise” and “risk-free service.” These companies have gained traction in the Indian financial sector due to various unique advantages not commonly found in other financial institutions.

According to the Companies Act of 2013, Nidhi companies are categorized within the Indian Non-Banking Finance Sector (NBFCs). The term “Nidhi” translates to “treasure” in Hindi, and these entities primarily engage in lending and borrowing money among their members. Operating as public limited companies, Nidhi firms collect funds from their members, which are then made accessible to other members at favorable interest rates.

Operating on the principle of mutual benefits, these firms are overseen by the Ministry of Corporate Affairs (MCA). The primary aim of establishing a Nidhi company is to promote cost reduction and savings among its members. It’s important to highlight that the members are separate entities from the company itself, allowing the company to conduct transactions under its own identity. This encompasses activities such as purchasing, selling, asset acquisition, debt incurrence, and legal proceedings, all conducted under the company’s name.

Nidhi companies operate under the Nidhi Rules of 2014 and are exempt from regulation by the Reserve Bank of India (RBI). As a result, they are not obligated to seek approval or a license from the RBI, streamlining the registration process. Unlike conventional NBFCs, Nidhi companies can initiate operations without obtaining an RBI license. Nonetheless, they are required to maintain a minimum membership of 200 individuals within the first year of commencing operations.

A minimum of seven individuals is required to establish a Nidhi company. These companies are prohibited from raising funds from the general public and are restricted to opening a maximum of three branches within a district.

Nidhi companies are prohibited from conducting microfinance or vehicle financing operations. Deposits can only be refunded after a three-month period from the date of acceptance, and depositors do not receive any interest until six months after the deposit is made.

Salient Features Of Registering Your Nidhi Company:

  1. A Nidhi company has the flexibility to determine its membership size without any upper limit, allowing for unlimited members. Shares owned by members can be freely transferred among them.
  2. The liability of directors and shareholders is confined to the unpaid amount on their respective subscribed shares, ensuring limited liability.
  3. Nidhi companies are prohibited from raising funds from the general public, necessitating membership for depositing or borrowing.
  4. To engage with a Nidhi company’s financial activities, one must first become a member by subscribing to its shares.
  5. Within a district, a Nidhi company can establish up to three branches, with operations confined to its home state.
  6. Expanding into multiple states requires the registration of separate Nidhi companies, maintaining consistent shareholders.
  7. Nidhi companies are restricted from engaging in microfinance and vehicle finance operations.
  8. Deposit repayments by a Nidhi company are not permitted within three months of acceptance.
  9. No interest can be claimed by depositors during the first six months from the date of deposit.
  10. If a depositor requests repayment before the deposit’s maturity, the interest rate may be reduced by 2%.
  11. Nidhi companies are recognized under the business name “Nidhi Limited.”

The Registration Process:

The Nidhi Company registration can be completed in just 4 steps.

 

Obtain digital signature of the directors 

Obtain DIN no. of the directors 

Company Name Approval 

Incorporation Certificate 

Requirements For The Nidhi Company Registration

  • Unique name: A distinct name must be suggested for the company, and you can verify its availability using our online tools for checking company names.
  • Directors: At the outset, the company should have two directors and seven shareholders, all of whom must be individuals over 18 years old. Directors can also hold shares as stakeholders, but the distribution of shareholding must be explicitly stated.
  • Authorized capital: To establish a Nidhi company, it is necessary to have an authorized capital, which represents the highest value of shares that the company is authorized to issue.
  • Registered office: To commence and register a company in India, having a registered office address is crucial. This address is publicly accessible on the Registrar of Companies (ROC) website and can be a residential address.
  • Net owned fund: While there is no mandatory paid-up capital for establishing a nidhi company, a net owned fund (NOF) of Rs.10 lakhs is required within three months of the company’s registration. Paid-up capital refers to the funds received by a company from its shareholders against issued shares, while NOFs encompass the total of paid-up equity and free reserves, after deducting total losses and intangible assets, as per the latest audited balance sheets.

Mandatory Requirements After Incorporation Of A Nidhi Company:

Within one year of incorporation, a nidhi company must ensure the following compliances:

  • Within the first year of operation, the company must have a minimum of 200 individuals registered as members.
  • The company should maintain a Net Owned Fund (NOF) of at least Rs. 10 lakhs. No initial capital is necessary during registration, the company must achieve a NOF of Rs. 10 lakhs within 90 days post-registration.
  • The ratio of NOF to deposits should not exceed 1:20.
  • Term deposits without any liabilities should constitute at least 10% of the total outstanding deposits.

Why Should You Register A Nidhi Company?

  • Easy and affordable registration, formation and incorporation: Establishing, registering, and incorporating a nidhi company is comparatively straightforward and less complex than other NBFCs and financial entities. Initially, only seven members and three directors are needed, with minimal paperwork involved. The registration process is affordable, uncomplicated, and does not require an extensive amount of time.
  • Individual legal entity status: All Nidhi companies possess an independent legal entity status, granting them extensive legal capabilities. They can own assets and liabilities under the company’s name. Additionally, a Nidhi company maintains its existence indefinitely until officially dissolved. Thanks to its distinct legal entity status, a Nidhi company persists regardless of alterations in membership, such as member death, retirement, or departure, adhering to a policy of perpetual succession.
  • Credibility: Nidhi companies are considered to have greater credibility compared to other mutual benefit organizations. While state governments oversee other similar entities, Nidhi companies are regulated by the central government, enhancing their credibility.
  • Simple and easy management systems: To establish a Nidhi company, three directors and seven members are necessary. Any alterations in the management team, responsible for overseeing Nidhi companies, can be swiftly implemented by submitting straightforward forms to the ROC (Registrar Of Companies). These streamlined procedures provide Nidhi companies with an advantage over other financial institutions. Additionally, having fewer members and directors simplifies the management process.
  • Limited liability: This indicates that members are legally liable only up to a certain extent, encompassing the liabilities of the Nidhi company. Members are not held personally liable for the company’s obligations.
  • Minimal risk: Nidhi companies exclusively provide loans and receive deposits solely from their members. Consequently, the risk of loan defaults is significantly minimized. Unlike other financial entities and NBFCs, Nidhi companies confine their financial dealings solely to their members, mitigating risks associated with external factors. Thus, Nidhi companies are regarded as one of the safest methods for deposit mobilization, offering a cost-effective means of raising funds from the public by enrolling them as members.
  • Exempted from RBI regulations: As mentioned previously, unlike conventional NBFCs, Nidhi companies operate independently of the RBI’s regulation. They do not need RBI authorization or approval to commence operations and do not require an RBI license. Nidhi companies are established as public limited companies under the MCA, and their financial operations adhere to the Companies Act of 2013 and Nidhi Rules of 2014. Compared to RBI regulations, compliance with these laws and rules is less stringent, simplifying the process of incorporating Nidhi companies.
  • Capital and NOF requirement is low: The minimal capital needed for establishing and registering a Nidhi company is exceptionally low, presenting a significant advantage. Within three months of registration, a minimum net owned fund (NOF) of Rs. 10 lakhs is mandatory, with a registration fee of Rs. 19,999 applicable. Thus, the NOF prerequisite for a Nidhi company is substantially lower compared to other NBFCs. The NOF calculation comprises equity share capital, free reserves, minus intangible assets and accumulated losses.

Documents Required For Nidhi Company

The registration procedure is entirely digitized. You can easily scan and send all required documents and photos using your mobile devices. One Click Business Solutions offers comprehensive support throughout the registration process, ensuring a smooth and hassle-free experience for you.

 

Documents of directors and shareholders:

  • Photo ID (passport size).
  • PAN card copy.
  • Identification proof (passport/driving license/voter ID).
  • Address proof (electricity/telephone/mobile bill, bank statement).

 

Documents required for the registered office:

  • Recent utility bill (electricity/mobile/telephone) for business premises.
  • Lease agreement copy (for rented property).
  • Property documents copy (for owned property).
  • Landlord No Objection Certificate (NOC) provided in specified format.

FAQs - Nidhi Company Registration

What Is A Nidhi Company?

A Nidhi company is a type of non-banking financial company (NBFC) that primarily deals with borrowing and lending money among its members, with the aim of promoting thrift and savings habits.

What Are The Key Requirements For Registering A Nidhi Company?

To register a Nidhi company in India, you need at least seven members, with the incorporation documents meeting the specified requirements outlined by the Ministry of Corporate Affairs (MCA). Additionally, the company must have a minimum paid-up equity share capital of Rs. 5 lakhs.

What Is The Process For Nidhi Company Registration?

The process involves obtaining Digital Signature Certificates (DSCs) and Director Identification Numbers (DINs) for the proposed directors, followed by the submission of the necessary incorporation documents to the Registrar of Companies (ROC).

What Are The Main Objectives Of A Nidhi Company?

The primary objectives of a Nidhi company include cultivating the habit of thrift and savings among its members, promoting mutual benefit by accepting deposits and lending to its members, and facilitating access to credit for its members at reasonable rates of interest.

Can A Nidhi Company Accept Deposits From The Public?

No, a Nidhi company is prohibited from accepting deposits from the public. It can only accept deposits and lend money to its members, who are also its shareholders.

Is There Any Restriction On The Area Of Operations For A Nidhi Company?

Yes, the operations of a Nidhi company are restricted to the district level. It cannot extend its operations beyond the district in which it is registered.

What Are The Compliance Requirements For A Nidhi Company After Registration?

After registration, a Nidhi company must adhere to various compliance requirements, including conducting annual general meetings, filing annual returns with the ROC, maintaining proper books of accounts, and complying with the regulations specified by the MCA.

Can A Nidhi Company Issue Secured Loans?

No, a Nidhi company is not permitted to issue secured loans. It can only provide unsecured loans to its members against the security of their deposits.

Is It Mandatory For A Nidhi Company To Have A Minimum Number Of Members?

Yes, a Nidhi company must have a minimum of 200 members within one year of its incorporation. If it fails to meet this requirement, it may face penalties or even deregistration.

Can A Nidhi Company Issue Preference Shares?

No, a Nidhi company is prohibited from issuing preference shares. It can only issue equity shares to its members.

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