NIDHI COMPANY

NIDHI stands for National Initiative for Developing and Harnessing Innovations. NIDHI Company is a financial institution or a type of NBFC that is involved in depositing and lending money to their members. This company is registered under the Companies Act, 2013 and is managed, as per the RBI’s guidelines. All the transactions are performed by the company’s members only. Since all the transactions are focused on the shareholders of the Nidhi Company, RBI has exempted the notified Nidhi companies from the core acts of RBI. This differentiates Nidhi companies from other NBFCs. Nidhi companies were started by the Ministry of Corporate Affairs (MCA) and are affiliated with the same. However, some of their decisions are controlled by the MCA.

ELIGIBILITY FOR NIDHI COMPANY REGISTRATION

1. Apart from the core members, Nidhi companies must have a minimum of 200 shareholders of the company. Only when a company has this minimum number of shareholders, they can apply for Nidhi company registration.
2. Any company wanting to register as a Nidhi company must have a minimum of Rs. 10 lakh of net-owned funds. This is necessary for the registration and must be followed. Any company having a lesser amount of net-owned fund is not eligible for Nidhi company registration.
3. The ratio between the net-owned funds and the deposits cannot be more than 1:20 for any companies which want to register for Nidhi Company. A ratio more than this is not accepted for a Nidhi company registration.
4. A company which wants to register as Nidhi Company must have a minimum 10% of unencumbered term deposits of the outstanding deposits. Term deposits more than 10% are acceptable but any less than 10% is not considered sufficient for Nidhi company registration.
5. The name of the company must always contain ‘Nidhi Limited’.
6. Companies registered under Nidhi company will be a public company.
7. The registering company must have paid equity share capital of Rs. 5 lakh.

DOCUMENTS REQUIRED FOR NIDHI COMPANY REGISTRATION

Proof of the registered place of business (Ownership documents/ rent or lease agreement)
No Objection Certificate (signed by the owner/ landlord)
Identity proofs
Address proofs of the members
Photos of the members
PAN card copies of the members
Digital Signature (DSC)
Director Identification Number (DIN) of the directors
Memorandum of Association of the company (MoA)
Articles of Association of the company (AoA)

FORMS TO BE FILED
There are two forms which are required to be filed in MCA 
INC 9
DIR 2