Process of Nidhi Company Registration
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Nidhi Company Registration
Nidhi Company Registration is a procedure through which incorporation of type of NBFC called Nidhi can be made possible and this incorporation takes place under the provisions of Companies Act, 2013. The business of Nidhi Company consists of acceptance of deposits and lending of money. Nidhi Company registration reinforces the feeling of savings as well as smart spending in the mind of its members.
Nidhi companies aim to cultivate the values of thrift amongst their members. The rules regarding a Nidhi Company suggest that it can proceed further for the transactions within restricted boundaries of work and only with its registered members. At the end of the name of all the Nidhi Companies, “Nidhi Ltd.” is a must.
Advantages of Nidhi Company Registration
Hassle Free Formation
It is a quite simple process to form Nidhi Company. There are very few requirements for the formation of a Nidhi company with hassle free documentation process which makes the process very flexible.
Low Financial risk
It lowers the financial risk taken by the company since all the lending and depositing transactions are performed by members of the company. As only the members are involved with the financial transactions it makes it safe and easy to track with the person depositing or borrowing funds from the company.
No RBI Compliances
Nidhi companies do not have to comply with the RBI regulations. This non-compliance gives the company a leverage to inculcate better and different rules for its functioning. It is quite difficult for Nidhi companies to formulate their own rules and regulations if compliance with RBI Regulations was required.
This is one of the basic objectives of Nidhi Companies to provide certainty on savings. Nidhi companies make sure that they will never peril the savings of their members where ever they invest.
Documents required for Nidhi Company Registration
Copy of PAN of Directors and Shareholders
Copy of ID Proof of Directors and Shareholders
Voter ID/AADHAR/Driving License/Passport
Copy of Address Proof of Directors and Shareholders
Bank Statement/ Electricity bill/ Mobile bill/ Telephone Bill
DSC & DIN of all directors
MOA & AOA
Passport size photographs
Property Ownership Documents of Registered office premises
- If property is owned: Electricity bill + Ownership Documents + NOC (if required)
- If property is rented: Electricity bill + Rent Agreement + NOC
Pre requirements for Nidhi Company Registration
|Minimum paid-up capital||Rs 5 Lacs|
Frequently asked questions
What is the minimum capital requirement for Nidhi Company Registration?
The minimum capital requirement for incorporating a nidhi company is Rs 5 lakhs.
How much time is required for Nidhi company registration?
It takes around 10-15 days to register a nidhi company.
Does a Nidhi company require RBI approval for registration?
No, a Nidhi company is a form of NBFC which do not require RBI’s approval for its registration.
Can Nidhi companies do a microfinance business or vehicle finance business?
No, Nidhi companies are not allowed to do microfinance business.
Who can become a member of Nidhi company?
Anyone who is above the age of 18 years can become a member of Nidhi Company.
What is the maximum amount of deposits a Nidhi Company can take?
A Nidhi Company is allowed to take the maximum of 20 times the net owned fund. For example, if you have invested Rs.1 Crore, then you are entitled to raise funds up to Rs. 20 Crore.
How many branches can be operated by a Nidhi Company ?
A Nidhi Company can open up to 3 branches within the district only after three years of continuous profit running of the business and it will require the Regional director permission. Also, a Nidhi Company cannot open a branch outside the state.
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