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Nidhi Company Registration

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What is a Nidhi Company?

A Nidhi Company is a type of Non-Banking Financial Company (NBFC) recognized under Section 406 of the Companies Act, 2013. Its core business is borrowing and lending money between its members. They are created for the mutual benefit of their members and to cultivate the habit of thrift and savings.

Nidhi Companies are popular because they are easier to register and regulate than other NBFCs. They are exempted from the core provisions of the RBI Act, making them an attractive option for small-scale financial services within a closed group. Taxcrafted Solutions ensures your Nidhi Company is compliant from day one.

Registration Process

  • Digital Signature Certificate (DSC)
  • Director Identification Number (DIN)
  • Name Approval (RUN)
  • MOA & AOA Drafting
  • Incorporation Certificate & PAN/TAN

Key Advantages

  • No RBI License Required
  • Easy to Form & Manage
  • Low Capital Requirement
  • Lending to Members Only
  • Secured Loans against Gold/Property

Requirements & Compliance

Essential documents and mandatory compliance for Nidhi Companies.

Documents Required

  • PAN Card of Directors/Members
  • ID Proof (Aadhaar/Voter ID)
  • Address Proof of Directors
  • Passport Size Photos
  • Office Address Proof (Utility Bill)

Post-Incorporation

  • Minimum 200 Members within 1 year
  • Net Owned Funds of ₹10 Lakhs
  • Unencumbered Term Deposits (10%)
  • Ratio of Net Owned Funds to Deposits 1:20
  • NDH-4 Form Filing

Restrictions

  • No Chit Funds or Hire Purchase
  • No Current Accounts
  • No Advertisement for Deposits
  • Dealing with Non-Members prohibited
  • Preference Shares not allowed

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Frequently Asked Questions

Common queries about Nidhi Company Registration.

What is a Nidhi Company?
A Nidhi Company is a type of Non-Banking Financial Company (NBFC) formed to borrow and lend money to its members. It works on the principle of mutual benefit and cultivates the habit of savings among its members.
Is RBI approval required for Nidhi Company registration?
No, Nidhi Companies are exempted from the core provisions of the RBI Act. They do not require a license from the RBI to start operations but must strictly follow the Nidhi Rules, 2014.
Who can become a member of a Nidhi Company?
Only individuals can become members of a Nidhi Company. Bodies corporate, trusts, or minors cannot be admitted as members (though deposits may be accepted in the name of a minor by a natural guardian).
What is the minimum capital requirement?
To incorporate a Nidhi Company, a minimum paid-up equity share capital of ₹5 Lakhs is required. However, the company must raise its Net Owned Funds (NOF) to at least ₹10 Lakhs within one year of incorporation.
Can a Nidhi Company open branches anywhere?
Initially, a Nidhi Company can only operate within the district of its registered office. To open branches outside the district (but within the same state), it must have been profitable for three continuous years and requires Regional Director approval.
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