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Nidhi Company Registration with SNB Consultancy

SNB Consultancy enables community finance and thrift organizations to register as Nidhi Companies, a special class of NBFC (Non-Banking Financial Company) recognized under Section 406 of the Companies Act, 2013. These companies are ideal for promoting savings among members and facilitating secured loans without external involvement.

We guide you through the regulatory, documentation, and ROC compliance required to establish a legally compliant Nidhi Company.

Our Nidhi Company Registration Services Include:

  • Name reservation and pre-checks on MCA portal
  • Drafting and filing of incorporation documents with Registrar of Companies
  • PAN, TAN, and bank account setup post-incorporation
  • Assistance in preparing bylaws, member onboarding, and capital compliance
  • Post-registration compliance support including NDH-1, NDH-2, and annual filings

Overview of Nidhi Company Registration

A Nidhi Company is a type of Non-Banking Financial Company (NBFC) recognized under Section 406 of the Companies Act, 2013 and governed by the Nidhi Rules, 2014. These companies are created primarily to promote savings and provide loans among their members.

To register a Nidhi Company, a minimum of 7 members is required. They are also commonly known as Mutual Benefit Funds or Permanent Funds.

  • Governed by the Ministry of Corporate Affairs (MCA)
  • Not required to register with RBI, but must follow MCA guidelines
  • Can accept deposits and lend money only to its members
  • Restricted from conducting general NBFC activities or accepting public deposits

Key Eligibility Criteria for Nidhi Company Registration

  • Must be incorporated as a Public Limited Company
  • The company name must end with "Nidhi Limited"
  • Though not directly regulated by RBI, follows MCA and RBI-influenced guidelines
  • Activities restricted to borrowing/lending among members only
  • Can offer locker services (income ≤ 20% of total revenue)

Conditions for Incorporating a Nidhi Company in India

  • Minimum of 7 members, including 3 directors
  • ₹10 lakhs minimum equity share capital
  • Must be registered as a Public Company
  • MoA must clearly state intent to promote thrift and savings
Post-Incorporation Compliance (Within 1 Year):
  • Net Owned Funds (NOF) of at least ₹20 lakhs
  • Maintain 10% of deposits as unencumbered term deposits
  • NOF-to-deposit ratio maintained at 1:20
  • 10% of deposits in fixed deposits with a nationalized bank

Benefits of Nidhi Company Registration

  • Affordable credit access with low-interest loans
  • Encourages savings among members
  • Simple setup with low cost and compliance
  • No RBI compliance required
  • Low-risk model – transactions limited to members
  • Economical operations suitable for small communities
  • Protection of member savings and contributions
  • NOF leverage with 1:20 deposit ratio

Documents Required for Nidhi Company Registration

For Directors & Members:
  • DIN & DSC of directors
  • Passport-sized photographs
  • PAN card of all members and directors
  • ID & residential proof (Aadhaar, DL, bank statement, utility bill)
  • Passport (if foreign national)
For Company Incorporation:
  • MoA & AoA
  • Registered office proof (rent agreement, utility bill, or ownership proof)
  • No Objection Certificate (NOC) from property owner

Step-by-Step Procedure for Nidhi Company Registration

  1. Obtain DSC & DIN for proposed directors
  2. Select and reserve a unique name ending with “Nidhi Limited”
  3. Submit name reservation via RUN or SPICe+ Part A
  4. File SPICe+ Part B with documents to ROC
  5. Receive Certificate of Incorporation (CIN issued)
  6. Apply for Nidhi Company status via NDH-4 within 4 months

Restricted Activities for Nidhi Companies

  • No chit funds, hire purchase, leasing, or securities trading
  • No debentures, preference shares, or debt instruments
  • No current accounts for members
  • No external borrowing/lending with non-members
  • No partnership in lending/borrowing businesses
  • No public advertisements for deposits
  • No incentives for deposit mobilization or loan issuance

Branch Opening Guidelines

  • Up to 3 branches in one district without special approval
  • More than 3 branches or branches outside district require NDH-2 filing and RD approval
  • Company must have 3 years of continuous profits
  • Branches outside state require special approval

At SNB Consultancy, we provide end-to-end support for Nidhi Company Registration. From DSC/DIN procurement to ROC filing, incorporation, compliance, and status approvals, our experts ensure a smooth, reliable, and compliant process.

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