Nidhi Company Registration

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Introduction

As earlier under Companies Act, 2013 at least two persons were required as Members and Directors to form a Company which is not the same in the case of OPC. It is a simplified process with online filing and process.

In this type of entity it has only one shareholder who owns the 100% stake in the company. Also a nominee is required to be appointed in order to maintain the character of perpetuity who shall work in place of the owner in case of circumstances like death or his/her inability to continue.

Firm Registration has team of experts providing you the best assistance, timely delivery and guaranteeing the highest customer satisfaction with respect to Company incorporation process. You may get in touch with our team on call or email info@firmregistration.in for One Person company registration and Compliance services.

Advantages

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Advantages of Nidhi Company

Micro Finance

Nidhi Company lends money in the remote as well as rural areas of the country and which are on the off site locations.

Limited Liability

The liability of the Members is limited to the extent of Capital invested by them in the Company and therefore.

Less Complexity

Nidhi Company involves fewer complexions and can be incorporated with an amount of Rupees 10 Lakhs which is to be raised.

Good option for savings

As the main objective of establishing Nidhi Company is to develop a habit of savings among the people for their mutual benefit as they can only lend and borrow money from their members only.

Better Credit Co-operative society

Nidhi Company has some similarities to the co -operative society and is suitable for the small financers. Once it gets registered it can avail the benefits of credit.

Easy Access to Public Funds

Nidhi Company can take deposits from its members through various accounts like Saving Account, FD A/c, Rd A/c which is less complex than taking finance from banks and other Financial Institutions.

Minimum

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Minimum Requirements

Documents

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Documents Required for Incorporation

PAN Card

of the Member and Directors of the proposed Company Passport in case of Foreign Nationals

Identity Proof

of the Member and Directors of the proposed Company; (Aadhar /Voter ID/Driving License/Passport)

Address Proof

of the Members and Directors (Utility Bill/Telephone Bill/Mobile Bill/Bank Statement not older than two months)

Passport Proof

passport size photograph of Member and Directors

Business Address Proof Owned Property

(Copy of Registry and Latest Govt. Electricity Bill or Water Bill)

Business Address Proof Rented/leased

Rent Agreement, NOC from the Owner, Latest Govt. Electricity Bill or Water Bill)

Process

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Process of Incorporation of Nidhi Company

1. Complete the Application Form

You are requested to first fill the simple questionnaire provided by our expert team.

Step 01

2.Document Processing

At the second step we will be requiring the documents in accordance with the questionnaire filled by you so that we can arrange them as per the requirement and for processing.

Step 02

3. Application for DSC

First of all DSC (Digital Signature Certificate consisting of the E-signatures) is required to be prepared. This step can be ignored if prepared already. It will approximately take 1-2 days.

Step 03

4. Name Availability

The next step is to check the name availability. The name should be unique in nature and should not be similar to name of any other entity registered. It may take at least 1-2 days.

Step 04

5. E-filing for incorporation of a Company

Once the name is approved, an online application is required to be filed through SPICE+ along with the requisite documents as obtained from the client with ROC. The MOA as well as AOA shall be filed online. This process again takes approximately 2-3 days.

Step 05

6. Get Certificate of Incorporation

Once the Company gets incorporated we will share all the docs like Incorporation Certificate, MOA, AOA and Digital Signatures.

Step 06

Registration

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Post Registration Requirements

Minimum 200 Members should be there within 120 days of incorporation

Net Owned Funds should be 20 Lakh Rupees or more within 120 days.

Unencumbered deposits should be more than 10% of outstanding deposits

The ratio for Net Owned Funds to Deposit should not be more than 1:20

Loans & Deposits

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Loans & Deposits

Nidhi companies have an advantage over other type of finance vehicles that they can lend loans and accept deposits from general public (members) without the approval of RBI. It is important to know the basics before doing the same

Loans

Can provide loan only to its members
Certain Monetary Limits have been defined for giving loans
Can only give secured loans against gold, silver, immovable property, FDs, NSC, other Govt Securities and Insurance Policies
It can charge interest rate 7.5% above the rate of interest offered on deposits on reducing balance method

Deposits

Can accept 20 times deposit of the Net Owned Funds (Example : If NOF is Rs. 10 lakhs, it can accept deposits amounting to Rs. 2 crores
Deposits can be accepted in the form of FD A/c, RD A/c, Savings A/c
Can pay interest on FD and RD up to 12.5% and 6% on Savings A/c.
Fixed Deposits Tenure : 6 months – 60 months
Recurring Deposits Tenure : 12 months – 60 months

Compliances

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Compliances of Nidhi Company of Post Incorporation

NDH-1

NDH-1: NDH-1 is a one-time form to be filed by Nidhi Company incorporated before 19th April 2022, within 90 days of the closure of the first.

NDH-3

NDH- 3 form is filed within 30 days on half yearly basis and details of the members, deposits, loans are reported to department.

NDH-4

NDH-4 form has to be filed within 120 days from the date of incorporation for declaration of the status as Nidhi Company.

Other Forms

Nidhi has to file other forms like AOC-4, MGT-7, MGT-14 and other event based forms as per the applicability.

Faq's

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FAQs on Startup India Registration

What is deposit limit in a Nidhi Company?

A Nidhi Company cannot accept deposit exceeding 20 time of its Net Owned Funds as per the last audited Balance Sheet.

What is the maximized saving limits?

One Member of Nidhi Company shall not have a maximum balance of more than Rs. 1 lakh in a savings account and the maximum rate of interest to be paid on any deposits shall not be more than 2% above the rate of interest payable by nationalized banks, on such deposits.

Can a Nidhi Company carry on the business as a microfinance company?

No, a Nidhi Company cannot carry on the business as a microfinance company as the guidelines for both the entities are totally different.

Can a Nidhi Company open Branches ?

Yes a Nidhi Company can open three branches in the State in which it has registered office after earning profits for continuously three years. The branch can be opened outside the state after taking approval from Regional Director.

What are Net Owned Funds?

Net Owned Fund = Paid up share capital + Free Reserves – Accumulated losses, deferred revenue expenditure, and other intangible assets

What are the restrictions applicable on Nidhi Company?

Nidhi Company is prohibited to engage in chit funds, insurance, leasing finance or acquisition of securities issued by any Body Corporate.
Nidhi Company can’t issue preference shares, debentures or any other such instrument.
It can only accept deposits and lend money to its members.
These type of entities cannot pay any incentive for mobilizing funds accepted as deposits.

Is there any requirement to take the approval of RBI for running Nidhi Company?

No, there is no requirement to take the licence or permission from RBI as RBI has exempted Nidhi Companies from its core provisions

Can we close the Branches of Nidhi Company?

Yes you can close the branches by giving an intimation to Registrar and by publishing advertisement in newspaper.

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