Nidhi Company Registration

A Nidhi Company is a type of NBFC that promotes savings and thrift among its members. Registered under the Companies Act, 2013, it enables lending and borrowing within a closed group without RBI approval. With low capital requirements and simple compliance, it’s an ideal choice for small financial institutions.Register your Nidhi Company with Udyog Suvidha Kendra and get hassle-free support for documentation, incorporation, and compliance. Start your financial journey today!

Nidhi Company Registration

Benefits of Nidhi Company Registration

Encourages Savings Among Members: Promotes financial discipline and regular savings.

No RBI Approval Required: Simplifies registration with minimal regulations.

Limited Liability Protection : Protects members from personal financial risk.

Simple Compliance Requirements: Easy reporting and regulatory compliance process.

Low Capital Requirement: Start with just ₹5 lakh initial investment.

Exclusive Lending to Members:Ensures secure financial transactions within members.

We are India's fastest growing online business services platform dedicated to helping people to start and grow their business, at an affordable cost. Our aim is to help the entrepreneur with regulatory requirements, and offering support at every stage to ensure the business remains compliant and continually growing. We are Private Organization and providing services and assistance for Business Benefits who require consultation.

Nidhi Company Registration Application

Enter name of your Business Startup
Please enter name of authorized person.
Please enter pan number.
Please enter your email id.
Please enter your mobile number.
Please enter your address.
Please select state.
Please enter city.
Please enter pincode.
     
Please enter GST Number.
You Must agree both Terms before Submitting the Form.
You Must agree both Terms before Submitting the Form.
Startup India Certificate Sample

Nidhi Company Registration

4.8 4355 customers

Process for Nidhi Company Registration

STEP 1

  • Fill the online application form with required details accurately.
  • Make secure payment via the online portal.

STEP 2

  • Get confirmation of form submission and payment receipt.
  • Get a follow-up call to discuss required documents and clarify any details.

STEP 3

  • Use the provided credentials to log in to the official registration portal.
  • Submit the filled application form along with required documents.

STEP 4

  • Application reviewed by authorities for verification and approval.
  • Resolution of Queries if any, Raised via Authorities.

STEP 5

  • Get official approval certificate upon successful verification.

What is a Nidhi Company?

A Nidhi Company is a type of Non-Banking Financial Company (NBFC) formed to promote savings and financial stability among its members. Registered under Section 406 of the Companies Act, 2013, it operates on a mutual benefit model, allowing members to lend and borrow money within the company. Unlike other NBFCs, Nidhi Companies do not require RBI approval, making them easier to establish and manage.

Key Features

Key Features of Nidhi Companies

  • Member-Exclusive Operations: Only members can deposit, borrow, or lend money.
  • No RBI Approval Needed: Operates under MCA with simpler regulations.
  • Encourages Savings: Promotes financial discipline in a trusted community.
  • Limited Liability: Members’ risk is limited to their shareholding.
  • Low Capital Requirement: Needs only ₹5 lakh as starting capital.
  • Regulated Compliance: Must follow Nidhi Rules, 2014, including a 1:20 NOF to deposits ratio and at least 200 members within a year.
Why Choose

Why Choose a Nidhi Company for Financial Services?

  • Exclusive Member-Based Operations: Only registered members can transact.
  • Encourages Savings: Promotes financial discipline within a trusted network.
  • Simple Compliance Requirements: Easier to manage compared to traditional NBFCs.
  • Low Risk & Secure Transactions: Lending is limited to members, reducing default risks.

Eligibility Criteria for Nidhi Company Registration

To register a Nidhi Company, a minimum of 7 members, ₹5 lakh capital, and Indian residency are required. It must meet compliance rules, including 200 members within a year and a 1:20 NOF-to-deposits ratio.

1

Who Can Register a Nidhi Company?

    To register a Nidhi Company in India, the following eligibility criteria must be met:
  • Minimum of 7 Members: To incorporate a Nidhi Company, at least 7 individuals are required, with 3 designated as directors.
  • Resident Indian Directors: All directors and shareholders must be Indian citizens.
  • Minimum Paid-Up Capital: A Nidhi Company must have a minimum capital of ₹5 lakh, which should be increased to ₹10 lakh within one year.
  • Company Structure: It must be registered as a Public Limited Company (Ltd.) under the Companies Act, 2013 and comply with Nidhi Rules, 2014.
Register Illustration
2

Legal Conditions and Restrictions

  • 200 Members Requirement: A Nidhi Company must have at least 200 members within one year of incorporation.
  • Net Owned Funds (NOF) to Deposits Ratio: It must maintain a 1:20 NOF-to-deposits ratio to ensure financial stability.
  • Restricted Business Activities: It cannot engage in chit funds, insurance, securities trading, or microfinance.
  • No External Lending: Loans can only be provided to registered members of the company.
Conditions Illustration

Document Required for Nidhi Company Registration

Documents for Directors and Shareholders
  • 1. PAN Card : Mandatory for all directors and shareholders.
  • 2. Aadhaar Card or Voter ID : Identity proof of all members.
  • 3. Passport/Driving License : Required if additional identity verification is needed.
  • 4. Latest Bank Statement or Utility Bill : Address proof (not older than 2 months).
  • 5. Passport-Sized Photographs : For all directors and shareholders.
Documents for Registered Office Address
  • 1. Rental Agreement or Property Ownership Papers : Proof of office location.
  • 2. NOC from Owner : If the office is in a rented space.
  • 3. Electricity Bill or Utility Bill : Should match the company’s registered address.
Company Incorporation Documents
  • 1. Memorandum of Association (MoA) : Outlines the trust’s purpose and operational scope.
  • 2. Articles of Association (AoA) : Establishes governance rules and internal management guidelines.
  • 3. Director Identification Number (DIN) : A unique identification number required for trustees or directors.
  • 4. Digital Signature Certificate (DSC) : Ensures secure and legally valid electronic document submissions.
>

Step-by-Step Process for Nidhi Company Registration

1

Get a Digital Signature Certificate (DSC) and Director Identification Number (DIN)

All proposed directors must obtain a DSC to sign documents electronically and a DIN issued by the Ministry of Corporate Affairs (MCA).

2

Name Approval from MCA

Submit a name approval application to MCA using the RUN (Reserve Unique Name) service. The name must include "Nidhi Limited" and follow MCA naming guidel

3

Draft Memorandum of Association (MoA) and Articles of Association (AoA)

Prepare the MoA (defining company objectives) and AoA (outlining internal management rules) as per Nidhi Rules, 2014.

4

File SPICe+ Form for Incorporation

File the SPICe+ (INC-32) form with MCA, along with the MoA, AoA, PAN, TAN, and other required documents for incorporation.

5

Obtain a Certificate of Incorporation

Once approved, the MCA issues the Certificate of Incorporation (CoI), officially recognizing the company as a Nidhi Limited entity.

6

Apply for PAN and TAN

After incorporation, apply for the company's Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) from the Income Tax Department.

7

Open a Business Bank Account

Open a corporate bank account in the company's name to manage transactions, receive deposits, and carry out business operations legally:

Post-Registration Compliance for Nidhi Companies

1. Minimum Members Requirement (At Least 200 Members Within a Year)

A Nidhi Company is required to reach at least 200 members within the first year of incorporation. Failure to meet this requirement can result in compliance issues and regulatory action.

1. Minimum Members Requirement (At Least 200 Members Within a Year)
2. Maintaining Net Owned Funds (NOF) and Deposit Ratio Compliance

2. Maintaining Net Owned Funds (NOF) and Deposit Ratio Compliance

A Nidhi Company must maintain a 1:20 NOF-to-deposits ratio, meaning for every ₹1 of owned funds, the company can accept ₹20 in deposits. Additionally, the minimum NOF must be ₹10 lakh at all times.

2. Maintaining Net Owned Funds (NOF) and Deposit Ratio Compliance

3. Mandatory Annual Filings to the Ministry of Corporate Affairs (MCA)

NDH-1 : Details of members and financial compliance.
NDH-3: Half-yearly returns of deposits.
AOC-4 : Annual financial statements.
MGT-7 : Annual return of the company.

3. Mandatory Annual Filings to the Ministry of Corporate Affairs (MCA)
4. Taxation and GST Compliance

4. Taxation and GST Compliance

Nidhi Companies must comply with income tax laws and file ITR annually. They must also register under GST and file regular GST returns for taxable services if applicable.

4. Taxation and GST Compliance
>

Common Challenges in Nidhi Registration and How to Overcome Them

Challenges Illustration
  • 1. Meeting the Minimum Member Requirement

    Nidhi Companies must have at least 200 members within one year, which can be difficult for new companies.
    Solution: Use referral programs, digital marketing, and networking to onboard members efficiently.

  • 2. Maintaining the NOF-to-Deposits Ratio

    The required 1:20 Net Owned Funds (NOF) to deposits ratio can be challenging to sustain.
    Solution: Keep adequate capital reserves and track deposit inflow to ensure compliance.

  • 3. Restricted Business Activities

    Nidhi Companies cannot deal in chit funds, insurance, or securities, limiting income sources.
    Solution: Focus on secure, member-based savings and lending models to ensure profitability.

  • 4. Complex Compliance and Annual Filings

    Filing NDH-1, NDH-3, AOC-4, and MGT-7 can be time-consuming and complicated.
    Solution: Hire a professional CA or CS to manage compliance and avoid penalties.

  • 5. Limited Funding Options

    External funding from non-members is not allowed, restricting business expansion.
    Solution: Encourage member investments and reinvest profits strategically.

Why Choose Us for Nidhi Company Registration?

1
Expert Guidance & Compliance Support

Our professionals handle documentation, approvals, and compliance, ensuring a smooth, error-free Nidhi Company registration process.

2
Fast & Hassle-Free Registration

We streamline complex procedures for quick approvals and seamless incorporation, saving you time and effort.

3
Affordable & Transparent Pricing

Get cost-effective services with no hidden charges, ensuring complete transparency and dedicated support.

>

Nidhi Company Registration FAQ's

What is a Nidhi Company?
A Nidhi Company is a non-banking financial institution that promotes savings and lending among its members. It operates under MCA regulations and helps members access low-cost loans and secure savings.
Any Indian citizen above 18 years can register a Nidhi Company with at least 7 members and 3 directors. It is ideal for individuals who want to provide member-based financial services with minimal risk.
As per the Companies Act, 2013, a Nidhi Company must have a minimum paid-up capital of ₹10 lakh. Additional funds may be required to maintain the mandatory 1:20 NOF-to-deposits ratio.
No, Nidhi Companies cannot accept deposits from non-members. Only registered members are allowed to deposit funds and avail loan services, ensuring secure, community-based financial management within the organization.
A Nidhi Company must maintain a 1:20 ratio of Net Owned Funds (NOF) to deposits. This means for every ₹1 of owned funds, the company can accept ₹20 in deposits from its members.
No, Nidhi Companies are exempt from RBI regulations, but they must comply with the Ministry of Corporate Affairs (MCA) and Nidhi Rules, 2014 to legally operate in India.
The entire registration process usually takes 15-25 days, depending on factors like document verification, MCA approvals, and name availability. Ensuring proper documentation speeds up the registration process.
Yes, Nidhi Companies can lend money only to their members at a regulated interest rate. They primarily offer secured loans against gold, property, and fixed deposits to promote financial stability.
No, Nidhi Companies are exempt from GST on financial transactions. However, if they provide additional taxable services, GST registration and regular tax filings may be required based on turnover.
Nidhi Companies must file NDH-1 (member details), NDH-3 (deposit returns), AOC-4 (financials), and MGT-7 (annual return) with the MCA to maintain compliance and avoid penalties.
No, only Indian citizens can register a Nidhi Company. NRIs and foreign nationals are not allowed to be directors, shareholders, or depositors in a Nidhi Company as per Indian regulations.
If a Nidhi Company fails to achieve 200 members within one year, it must file NDH-2 for an extension. Non-compliance may result in penalties or restrictions on accepting further deposits.
Yes, a Nidhi Company can open branches within the same state after three years of successful operations. Prior MCA approval is required to expand operations to multiple locations.
No, Nidhi Companies cannot publicly advertise for deposits. They can only promote membership benefits within their existing community and encourage members to contribute to the company.
You can start by consulting our experts for end-to-end guidance, from document preparation to MCA approval. Contact us today for a hassle-free and fast registration process.