A Nidhi Company is a type of Non-Banking Financial Company (NBFC) dedicated to lending or borrowing money to all its members as required. According to the Nidhi Rules, 2014, members can borrow money against tangible collateral such as property mortgage, gold, etc. Nidhi companies have to register under the Companies Act, 2013.
The conception of Nidhi Company was initiated to practice thrift amongst its members, receiving deposits and lending money for mutual benefit. A Nidhi company is regulated by the Ministry of Corporate Affairs but it does not need to receive any license from the Reserve Bank of India (RBI).
These companies will be registered as public limited companies, and you can mention them as “Nidhi Limited” following the names of the companies.
Minimum Requirements for Establishing a Nidhi Company:
The company should have at least:
- 200 members
- 7 Directors
- 7 Shareholders
- 5 lakhs of equity capital
- Net owned capital 10 lakh or more
- Nidhi must be a public limited company
- Should have “Nidhi Limited” at its name suffix
- The company can borrow and lend funds only from the members only
- Net Owned Funds to deposits ratio of 1:20 or less
- All directors must have DINs
Documents Required for Nidhi Company Registration
A list of documents is mentioned below for registering a Nidhi company. They are:
- Office Address details with Proof
- In the case of a rented office, NOC duly signed by the landlord
- Address-proof of the members
- Photographs of the members
- Members’ Copies of PAN cards
- DSC (digital signature certificate) of the company
- Identity Proofs of directors
- DIN of all directors
- A certified copies of MoA and AoA
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