About Nidhi Company

In its more recent context in the Indian financial sector it refers to any mutual benefit society notified by the Central / Union Government as a Nidhi Company. They are created primarily for the motive of cultivating the habit of thrift and savings among their members and generally it is in the form of Public Company. Nidhi Company is one of the categories of Non-Banking Financial Company (NBFC) that does not require any Reserve Bank license.

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Our Professional Fees : INR 44,840/-

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Our scope of work

    1. Any amount of Capital;

    2. Application for 3 Director Identification Numbers;

    3. Application of 3 Digital Signatures (validity 2 years);

    4. Name Approval;

    5. Drafting of Memorandum and Articles of Association;

    6. Drafting of other additional documents;

    7. Preparation of various eforms;

    8. PAN & TAN Application

    9. Resubmission of eforms, if any;

    10. Obtaining Certificate of Incorporation from Registrar

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Know more about Nidhi Company

In its more recent context in the Indian financial sector it refers to any mutual benefit society notified by the Central / Union Government as a Nidhi Company. They are created primarily for the motive of cultivating the habit of thrift and savings among their members and generally it is in the form of Public Company. Nidhi Company is one of the categories of Non-Banking Financial Company (NBFC) that does not require any Reserve Bank license.

1. Director:

  • Minimum no. of directors required are 3 out of which 1 shall be Indian Resident.
  • Any person can be a director of the company including family members
  • Director Identification No. (DIN) and Digital Signature Certificate (DSC) are required to be a director of the company
  • Directors are the managers and they are responsible for day to day functioning of the Company.

2. Shareholder:

  • Minimum no of shareholders required are 7.
  • Director and Shareholders can be the same.
  • Shareholders are the owners of the company

3. Capital:

  • There are 2 types of capital i.e. Authorize Capital (It is the capital up to which company is authorize to raise from the member and it can be increase as and when required.), Paid Up Capital (It is the capital which is paid up by the members of the company and it can be increase as and when required.)
  • There is no such requirement for minimum capital, hence the company can be formed with the capital starting from INR 1.

4. Registered Office:

  • Any place can be made as the registered office of the company even the residential place can be used as the registered office of the company.

5. Registering Authority:

  • Ministry of Corporate Affairs

Note:

1. Not Less than 200 Members: After incorporation, a Nidhi company must add at least 200 members to comply with this requirement of law. Further, it has to maintain this during the course of time. If the total members falls less than 200 at any time thereafter, it will leave the company at default. However, are not able to reach the limit of 200 members, then you must apply for time within 30 days of closure of financial year in Form NDH-2 with Regional Director

2. Net Owned Funds shall be INR 10 Lakhs.

3. Unencumbered term deposits of not less than 10% of the outstanding deposits.

4. A Nidhi Company shall not admit a body corporate or trust as a member.

5. A minor shall not be admitted as a member of Nidhi Company.

Obtain DSC (Digital Signature Certificate)

01

Prepare SPICe+ form (Part A – Name availability and reservation request)

02

Prepare SPICe+ Part B form (Company information i.e. directors, capital etc.)

03

Prepare e-form SPICe+ MOA (INC-33) ,SPICe+ AOA (INC-34) and SPICe+ AGILE-PRO (INC-35)

04

Download all the e-forms prepare online and affix DSC on all the e-forms.

05

Attached the require documents with form SPICe+ and upload the e-forms to MCA portal.

06

Verification of documents / forms by RoC

07

Issue of Certificate of Incorporation by RoC

08

Advantages

Owing to their non-dealing with the funds of any person other than their members, the regulations imposed upon the Nidhi’s by RBI is limited.
The Ministry of Corporate Affairs has done away with the minimum capital requirement of INR 5 lakhs for Nidhis. It is only after Nidhi rules, 2014, that mandated the infusion of INR 10 lakhs for such companies.
Unlike Other NBFCS, Nidhi’s don’t have to obtain a license from RBI. They just have to incorporate themselves as a public company with the MCA, infuse the required amount of capital as per Nidhi Rules, 2014 and they are all set to go.
The main aim of such companies is to promote the habit of saving and thrifts among lower and middle section of the society. These small sections of the population contribute to the funds of and avail credit from Nidhi companies.
The loans given to the members are at a lower rate of interest than the market rate this brings greater savings to the members.
The Nidhi companies are formed by, managed by, and provide benefits to their members only the outsider is not allowed to intervene into the working of The Nidhis, neither allowed to deposit money or avail credit from these companies.

Disadvantages

Since the Nidhi Companies accept deposits from their members only, the funds raised are limited in accordance with the number of members.
When the funds raised are limited, the availability of credit is also restricted. This defeats the whole purpose for which the Nidhi Companies are established.
Although there are no strict compliances imposed upon the Nidhis by RBI, still their activities are governed by the Reserve Bank especially their deposit acceptance operations.
The central government issues rules and directions governing Nidhi Companies from time to time. Therefore, they are not totally exempt from the regulatory framework.
Factors of Comparison Private Company Public One Person Company Limited Liability Partnership Partnership Sole Proprietorship
Capital Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit Min: INR 1 & Max:2 Crore Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit
Director Minimum 2 Minimum 3 Minimum 1 - - -
Shareholder Minimum 2 Minimum 7 Minimum 1 - - -
Designated Partner/Parter - - - Minimum 2 Minimum 2 -
Taxation 30%(25% if turnover does not exceed 250 Crore) 30%(25% if turnover does not exceed 250 Crore) 30% 30% 30% As per Slab Rates
Statutory Audit Compulsory Compulsory Compulsory If Contribution exceed INR 25 Lacs; If Turnover exceed INR 40 Lacs Not Required Not Required
Investor Preference High Low Low Medium Very Low Very Low
Compliance Cost Mdeium High Low Low Low Low
Regulator Registrar of Companies SEBI/Registrar of Companies Registrar of Companies Registrar of Companies Registrar of Firms -
Time take for Registration 5-7 working days 5-7 working days 5-7 working days 20-25 working days 10-12 working days 5-7 working days