Nidhi Company Registration

Nidhi Company is a company registered under the Companies Act, 2013, which is incorporated with the sole objective of encouraging and cultivating the habit of savings amongst its members. Its only objective is to accept deposits and lend money in between its members.

A Nidhi company Registration is a Public Company doing limited financial transactions between its members confined in territorial restrictions. It is regulated by the Ministry of Corporate Affairs under section 406 of the Companies Act, 2013. The Nidhi Company is exempted from the core of the directions and regulations of the Reserve Bank of India Act, 1934 regardless of accepting deposit and lending business.

It is allowed to accept deposits from its members and lend to its members only. Hence, the funds that are contributed to Nidhi company are only from its members and used only by its members.

What are the Main Objectives of Nidhi Bank Registration?

If you are planning to start a Nidhi bank registration, it is essential to register it with the Ministry of Corporate Affairs. The registration process is straightforward, and it is necessary to comply with the rules and regulations set by the government. In this section, we will discuss the main objectives of and why it is essential for your business.

• Savings

Similar to banks, a Nidhi Company has a right to open Saving Accounts of its members in order to promote and encourage the habit of saving among members.

• Ease of Fund

Just like banks a Nidhi Company can also raise funds. Nidhi Company Registration is the safest way to raise funds from the general public (just by registering them as members) through deposits, RDs (recurring deposits), and FDs (fixed deposits).

• Loan

Nidhi Company is allowed to lend money to its members only. However, they can provide only secured loans to their members.

• Micro Banking

There are many remote areas which still devoid of nationalized banks and NBFCs. Nidhi Company is the solution to this, as it can provide rural banking services to these locations.

If you are planning to start a Nidhi company, then you must know the advantages of Nidhi bank registration. Nidhi companies are non-banking financial institutions that are recognized under Section 406 of the Companies Act, 2013. These companies are formed with the objective of promoting thrift and savings among its members. These companies are formed with the idea of promoting savings among its members and providing them with financial assistance. Also, Nidhi companies are also known as mutual benefit companies or mutual benefit funds.

Here are some of the main advantages of Nidhi bank registration:

• Limited capital requirement

The Minimum Capital requirement as per Nidhi Company Registration is 10 lakhs as per Nidhi rules of 2014. 

• Easy procedure for Formation

The process for Nidhi Company Registration is easy and reliable. At an initial level, you require for about 7 members to start with, followed by fulfilling the documentation procedure (appropriating certificate of incorporation) via MCA registration procedure. 

It can be done easily just by filing forms to the Registrar of Companies of the respective state.

• Perpetual Succession

Just like any other company, a Nidhi company being a separate legal entity also have the benefit of' perpetual succession', i.e. it continuous existence and is unaffected by the death or departure of any member until it is legally dissolved.

• Easy to raise funds

In Nidhi Company Registration, it is much easier to raise funds from its members via shares and deposits. As it makes it simple for the company to raise funds without employing external financing. 

Nidhi bank registration provides several advantages to the company and its members. It provides limited capital requirement, perpetual succession, limited liability, easy fund-raising, tax benefits, and easy management. Therefore, if you are planning to start a Nidhi company, it is important to get it registered to avail these benefits

Nidhi Bank is a type of non-banking financial company (NBFC) that is registered under the Companies Act, 2013. It is a mutual benefit society that aims to promote the habit of thrift and savings among its members. Nidhi Bank is a popular choice for small-scale investors who are looking for a safe and secure investment option.

If you are considering Nidhi Bank registration, here are some key requirements that you need to fulfill:

• The name must contain - Nidhi Limited as the suffix
• A minimum paid-up capital of Rs. 20,00,000/- is required
• It can’t issue preference shares.
• At least 3 Directors and 7 Members are required. All directors need to be members of the proposed Nidhi Company.
• The objective of Nidhi Company solely would be to develop the habit of thrift and saving and the services of Nidhi company are only restricted to its members.

Are you planning to start a Nidhi Company? If yes, then you must be aware of the documents required for Nidhi Company incorporation. These documents play a crucial role in the registration process, and without them, you cannot register your company. In this section, we will discuss the essential documents required for Nidhi Company incorporation.

• Proof of Address- Bank / Electricity Bill/ Telephone bill/ Mobile bill
• Proof of Identity-voters Identity Card/Passport/ Driving License
• Address proof of company registered office - Rent agreement, Possession letter, NOC, Utility Bills not older than two months)
• Copy of the Property papers (if the property is owned).
• NOC (No-Objection-Certificate) from the owner (if the property is rented).

If you wish to start a Nidhi company registration, it's a great idea to start a business that helps people in saving and borrowing money. But before you begin, you need to register your Nidhi Company. Now, we will discuss the steps to incorporate Nidhi company registration.

Step 1: Obtain DSC (Digital Signature Certificate)

• It is necessary to apply for a Digital signature of the all the director and members before starting the Nidhi company registration.
• The DSC is important as all the documents before submission are required to be digitally signed.

Step 2: Apply for DIN (Director Identification Number)

• The requirement is conditional as the Incorporation Form itself can issue DIN of at least 3 Director. Other than above, the application for DIN is mandatory for each director.
• The DIN application has to make in Form DIR-3.

Step 3: Name Approval and its Reservation

• The Nidhi company name approval is an important step in order to establish a company. Choose a distinct name that speaks more about your brand and should not be the same as listed companies. 

   RUN (Reserve Unique Name) form is filled for the reservation of the name given by Nidhi Company.

Step 4: Preparation of form INC 33 and INC 34

• This step involves the drafting of MOA and AOA. These are drafted under INC 33 and INC 34 respectively.

Step 5: Incorporation of Nidhi limited company

• For the Incorporation of company, the incorporation forms (INC 33, INC 32, AGILE) are uploaded with SPICe Form. These are to be submitted with Central Registrar of Company.

Step 6: Approval of the documents

• Once the SPICe Form is approved, the registrar provides the company identification number (CIN) along with PAN and TAN of the company.

Conditions to be fulfilled in Nidhi Company Registration 

The following conditions are to be taken care by the Nidhi Company within one year of its registration- 

• Nidhi Company is required to have a minimum of 200 members within one year from its incorporation
• The net owned funds must be 10 lakh rupees or more.
• Unencumbered deposits (free of debt of financial liability) must be 10% or higher of the outstanding deposits
• The ratio of the deposits cannot be over 1:20 times of its net owned funds.

Nidhi Company Registration is regulated by the Ministry of Corporate Affairs (MCA). MCA has provided a set of guidelines for Nidhi company’s operations which are all mentioned in Nidhi Rules, 2014.

A Nidhi Banking company is a deposit-taking entity and hence requires a higher level of diligence regulatory norms. Consistent with the Nidhi Rules, following are the compliances that are needed to be followed-

• Form NDH-1: Within 90 days after the Closure of the Financial year
• NDH-2: If a Nidhi Company fails to complete 200 members in its 1st Financial Year then within 30 days from closing of first financial year, is required to file with MCA.
• Form NDH-3: This is for the filling of half-yearly returns, and this is submitted along with CA/CS Certificate
• Board Meetings: Quarterly
• Member Meetings: Annually
• AOC 4: Need to File-one In a Year
• MGT 7: Once in a Year
• Accounting & Book Keeping: Regularly
• Income Tax Return: by 30th September

Prohibited Activities for the Nidhi Company 

As far as Nidhi companies are involved in the financial transactions, they are prohibited from some activities, which are -

• Chit funds
• Lotteries
• Insurance 
• Unsecured lending
• Leasing Finance and Hire-Purchase finances
• Advertise themselves for deposits
• Sell the assets of its members
• Entering into a partnership firm so as to hold out lending and borrowing activities
• Accepting deposits or lending funds aside from its members

Tax Advice for Nidhi Company Registration 

Preparing & file business taxes can be complicated. Our expert CA/CS will help you to prepare and file tax forms correctly with a minimal fee and on time for your Nidhi Company 

Annual Audits & Compliances for Nidhi Company Registration

Our expert CA/CS will complete annual audits and compliances for your Nidhi registration on time.

At Corpseed, we understand the importance of having a Nidhi Company Registration. It is a crucial step towards expanding your business and reaching new heights of success. Our team of experts has years of experience and Extensive knowledge of the procedures involved in obtaining Nidhi Company registration. We are well-versed in the legalities and regulations of the process, ensuring that your registration is completed seamlessly and efficiently. With our expertise, you can rest assured that your registration process will be handled with the utmost care and professionalism. So, if you are looking for a reliable and experienced team to handle your Nidhi Company registration, look no further than Corpseed.