Nidhi Company Registration

Overview of the Nidhi Company Registration procedure in India:

Nidhi Company is a Non-Banking Financial Company (NBFC). It is registered under Section 406 of the Companies Act, 2013. The members or shareholders of a Nidhi Company can grant advances or loans and purchase government-issued stocks, debentures, bonds, securities etc., through their investment in the Nidhi Company itself. Nidhi Company earns returns for its shareholders and members by providing loans at a cheaper rate than the market, urging them to save more money and reinvest in Nidhi Company again.

Advantages of registering a Nidhi Company:

It is a very different kind of company and has various advantages. Let’s see these benefits below:-

• Urges the members to save: This company urges its members to keep them in return for helping them and other members in their time of need.
• Provides members cheaper loans: As Nidhi Company is a mutual benefit society, it offers loans to the members at a lower interest rate than the banks and market. This is achieved by lending the money of other members in a better financial state to those needing a loan.
• There are fewer complications: It is easy to borrow or lend money to the company members as they are not strangers and have low chances of defaulting.
• Easy to start: It is easy to create a Nidhi Company compared to other companies that fall under NBFC.
• Offers Micro Banking Services: This company provides banking services to the residents of rural regions in India as it is systematically planned for primarily such distant locations.

Requirements to fulfill while setting up a Nidhi Company:

There are a few requirements that are needed to be met when registering a Nidhi Company:-

• Minimum Share Capital: A Nidhi Company should have a paid-up share capital of 5 Lakh INR. There’s another condition with this: the Net Owned Funds should grow to 10 lakhs INR in 1 year starting from the registration date.
• The Net Owned Funds and the deposits ratio must be 1:20. The 10% of this total deposit amount must be in fixed deposits in national banks.
• There should be more than 200 members within a year of the company starting date.

What are the documents required when registering your Nidhi company?

This is the list of documents demanded by the authorities when registering a Nidhi Company in India:-

• Aadhar Card/ Voter Card/ Driving License/ Passport of the Directors and Members of the company as identity proof.
• Address proof in the form of the latest electricity bill/ telephone bill/ gas bill of the directors
• Rental Agreement and NOC if rented else Sale Deed of the office
• PAN Card of the Members
• AoA, MoA and MCA form

Step by Step guide to the Registration Process:

The steps to register a Nidhi Company is pretty easy. However, Eazy Startups can assist and even shorten your formalities with expertise. These are the steps to register:-

• Applying for DSC and DIN for the directors
• Writing a unique name after checking its availability
• Submitting MoA and AoA to the ROC with the resonated subscription statement
• Collect the CIN from the ROC
• Applying for PAN, TAN and Bank Account

Frequently Asked Questions