Nidhi Company

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Nidhi Company

  • Company Registration
  • Share certificates
  • Current Account opening
  • GST Registration
  • 8 Digital Signatures
  • 1 RUN Name Approval

Market Price – Rs: 41,899 

OnlineTaxSeva Price- Rs: 29,599 (All Inslusive)

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“Note: Please talk to an advisor first and get all doubts resolved before proceeding with payment. Once we receive the payment, our team will reach out to you and work on the service.”

 

Documents Required For Nidhi Company

Utility Bill
Registered Office

Nidhi Company Registration

A nidhi company is a type of company in the Indian non-banking finance sector, recognized under section 406 of the Companies Act, 2013.Their core business is borrowing and lending money between their members.They are also known as Permanent Fund, Benefit Funds, Quasi Bank, Mutual Benefit Funds and Mutual Benefit Company. They are regulated by Ministry of Corporate Affairs, which is also empowered to issue directions to them in matters relating to their deposit acceptance activities. However, in recognition of the fact that these companies deal with their shareholder-members only. Nidhi means a company which has been incorporated with the object of developing the habit of thrift and reserve funds amongst its members and also receiving deposits and lending to its members only for their mutual benefit.

Nidhi companies existed even prior to the existence of companies Act 2013. The basic concept of nidhi is “Principle of Mutuality”  These companies are more popular in South India, and 80% of Nidhi companies are located in Tamil Nadu.

Nidhi Companies in India are subject to several restrictions and regulations, which are enforced by the Reserve Bank of India (RBI) to ensure their proper functioning and prevent any misuse of the funds collected from members. Here are some of the key restrictions on Nidhi Companies:

  1. Acceptance of Deposits: Nidhi Companies can accept deposits only from their members and not from the general public. They cannot accept deposits exceeding 20 times their net owned funds.

  2. Lending: Nidhi Companies can lend only to their members, and no non-member or outsider can avail of their services. The lending must be for the purpose of meeting their genuine needs and not for speculative purposes.

  3. Loans and Advances: Nidhi Companies can provide loans and advances to their members only against securities such as gold, silver, immovable property, or any other approved securities. They cannot provide unsecured loans or advances.

  4. Investments: Nidhi Companies are not allowed to invest in shares, debentures, or any other securities issued by any other company. They can invest their funds only in government securities, fixed deposits, and other approved securities.

  5. Share Capital: Nidhi Companies cannot issue preference shares or debentures. They can issue only equity shares with a minimum face value of Rs.10 per share.

  6. Branch Network: Nidhi Companies can open branches only within the state where their registered office is located. They cannot open branches outside the state or operate through franchisees.

  7. Other Restrictions: Nidhi Companies cannot engage in any other business activity except for the borrowing and lending of money between its members. They cannot carry out any chit fund, hire purchase, or leasing business.

Compliance with these restrictions and regulations is important for Nidhi Companies to function smoothly and avoid any legal issues or penalties. It is advisable to seek the assistance of a professional or a qualified corporate service provider who can guide you through the incorporation process and ensure compliance with the regulatory requirements.

Registration of Nidhi Companies

Nidhi companies are a type of non-banking financial company (NBFC) that primarily deals with promoting the habit of thrift and savings among its members. Nidhi companies are regulated by the Ministry of Corporate Affairs in India and are governed by the Nidhi Rules, 2014. Here are the steps involved in registering a Nidhi company:

  1. Minimum Requirements: To register a Nidhi company, the minimum requirements are:
  • Minimum 3 directors
  • Minimum 7 shareholders
  • Minimum paid-up share capital of Rs. 5 lakhs
  • The company should have the word “Nidhi Limited” in its name

  1. Obtain Digital Signature Certificate (DSC) and Director Identification Number (DIN): The first step is to obtain a Digital Signature Certificate (DSC) and Director Identification Number (DIN) for all the proposed directors of the company. This can be done online through the Ministry of Corporate Affairs website.

  2. Choose a Name: The next step is to choose a suitable name for the company. The name should not be identical or similar to the name of any existing company or trademark.

  3. File SPICe+ form: The next step is to file the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form on the Ministry of Corporate Affairs website. This form contains details such as the proposed name, registered office address, details of the directors and shareholders, etc.

  4. MoA and AoA: The Memorandum of Association (MoA) and Articles of Association (AoA) must be drafted and submitted along with the SPICe+ form. The MoA and AoA of a Nidhi company must be in accordance with the Nidhi Rules, 2014.

  5. Certificate of Incorporation: Once the SPICe+ form and MoA and AoA are approved, the Registrar of Companies (ROC) will issue the Certificate of Incorporation (CoI). The CoI signifies the birth of the Nidhi company and provides proof of its legal existence.

  6. Apply for PAN and TAN: After obtaining the CoI, the company must apply for the Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) from the Income Tax Department.

  7. Bank Account: The company must open a bank account in its name to carry out its operations.

  8. Nidhi Company Registration: The final step is to apply for Nidhi company registration with the Regional Director of the Ministry of Corporate Affairs. The application should be accompanied by various documents such as the MoA and AoA, CoI, PAN and TAN, etc.

Once the application is approved, the company will be granted the certificate of Nidhi company registration and can commence its operations as a Nidhi company.

 
 

Nidhi Company FAQ’s

 

How many individuals are need to register a Nidhi Company?
A Nidhi corporation must have at least 3 directors and 7 shareholders in order to be registered in India.

What qualifications must one meet to become a director?
The Director must be at least 18 years old and a natural person.

3. Is a business location necessary to launch a Nidhi Company?
The location of the company’s registered office in India must be specified. Residential, commercial, or industrial properties may be used as the location for receiving MCA communications.

4. Is it necessary for me to be physically present to create a Nidhi Company?
No, you are not need to appear in person at our office or any other office in order to register a Nidhi Business.

5. What exactly are digital signature certificates?
When submitting papers online, a digital signature can be used to prove the sender’s or signee’s identity electronically. The Directors must digitally sign some application documents, according the Ministry of Corporate Affairs’ (MCA) authority.

6. What are the documents required for Nidhi Company registration?

All candidates for Nidhi Company directors must provide identification and evidence of residence. For Indian citizens, a PAN Card is required. Also, the registered office landlord is required to provide his or her identity and address verifications as well as a No Objection Certificate for the registered office to be located on the landlord’s property.

7. How long does it take to form a Nidhi Company?
During 20–30 days, Etailed.com can incorporate a Nidhi company. The length of time it takes to register depends on how quickly the customer submits the necessary paperwork and how quickly government approvals are granted. Please select a distinct name for your company and make sure you have all the necessary information to enable quick registration.

8. How many years is the Company’s registration valid?
As long as the yearly compliances are consistently satisfied, a Nidhi Corporation that has been formed is operational and will continue to exist. During one year of establishment, a Nidhi Corporation must meet certain requirements, such as having 200 shareholders minimum. In the event that yearly compliances are not met, the Nidhi Corporation will be required to return the deposits.

9. What is DIN?
Each current and prospective director of a company is given a unique identifying number called a “Director Identification Number.” Every current or potential Directors shall be required to possess a Director Identification Number. A person is only permitted to have one Director Identification Number, and it never expires.

10. Who controls Nidhi Companies?
Nidhi Corporation is subject to regulation, and Nidhi Company Registration is the responsibility of the Ministry of Corporate Affairs.

11. May Nidhi Companies issue debt securities or preferred shares?
No, Nidhi Companies are not permitted to issue debentures, preference shares, or any other types of debt securities.

12. Can Nidhi Companies operate in other states?
No, Nidhi Corporation is unable to conduct business outside of the state in which it was registered.

13. Can Nidhi Firms provide unsecured loans?
No, the Nidhi Corporation cannot make unsecured loans. It can, though, lend money to its members with security.