Nidhi Company Registration: Empower Savings and Mutual Benefits

Embrace innovation through Nidhi Company registration, redefining savings and benefits. Nidhi Rules 2014 provide the framework for exclusive member deposits and lending, revolutionizing financial dynamics.

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Nidhi Companies operates on principle of mutual benefits and also known as Permanent Fund, Benefit Funds, Mutual Benefit Funds and Mutual Benefit Company.

Provisions of Nidhi Companies are regulated through Nidhi Rules 2014 (rules) of Companies Act, 2013 (Act).

As per rule 3(da) Nidhi Company means:

"A company which has been incorporated as a Nidhi with the object of cultivating the habit of thrift and saving amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit, and which complies with the rules made by the central Government for regulation of such class of companies."

Nidhi Companies accept money from its member and promote the habit of saving and growing value of money among their members.

Nidhi Companies shall:

have the object of cultivating the habit of thrift and saving amongst its members

receive deposits from, and lend to, its members only

all activities do be done for mutual benefit of members only

Minimum Requirement

A Nidhi Company can be incorporated under Companies Act, 2013

It should be registered as a Public limited Company

✓ 3 Directors

✓ 7 Shareholders

✓ 1 Registered Office

✓ 10 lakh of capital

✓ No preference shares can be issued

Every Nidhi Company should ensure within a period of 1 year of incorporation it has:

✓not less than 200 members

✓Net Owned Funds of 10 lakh rupees or more;

✓unencumbered term deposits of not less than 10 % of the outstanding deposits

✓ratio of Net Owned Funds to deposits of not more than 1:20.

Nidhi Company object shall be only “cultivating the habit of thrift and savings amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit.”

Every “Nidhi” shall have the last words ‘Nidhi Limited’ as part of its name


1. Apply for Digital Signature of proposed members and directors of the Company.

2. Ascertain name of the Company and check the availability of the same in accordance with section 4 of the Act and Rule 8 of the Companies (Incorporation) Rules 2014.

3. File name application in PART A of web based form SPICE+, applicant can file two proposed name in this web based form, after approval of name, file incorporation documents again in PART B of web based form SPICE+ after selecting category of Company as “ NIDHI COMPANY” and Sub Category will automatically fill “PUBLIC LIMITED COMPANY”

4. Alternatively applicant can directly file name and incorporation application together in SPICE plus, by filing PART A and PART B simultaneously but it may be noted that through Spice Plus only one name can be applied and all documents of the Company to be filed in such proposed name.

5. Proposed directors of the Company can also apply for DIN in same form is they are not holding DIN prior to application. Maximum three directors can apply for DIN allotment at the time of application.

6. Applicants needs to submit below given documents with Spice plus

E- Memorandum of Association in form INC 33

E-Articles of Association in form INC-34

Proof for Registered Office

Declarations in prescribed format

Id and Address proof for subscribers and directors etc.

7. Spice plus will be submitted along with AGILE-PRO for application of GSTIN, EPFO,ESIC, Profession Tax, opening bank account.

8. After scrutiny by the Registrar at Central Registration Centre, in case of any deficiency the Registrar may call for additional documents or clarification after providing a chance to resubmit form in 15 days, however if all the documents and details are appropriate than Registrar will issue Certificate of incorporation in form INC-11.

What is included in this

1. 2 Digital Signature Certificate (DSC)

2. 2 DIN;

3. E-MOA;

4. E-AOA;

5. PAN;

6. TAN;

7. Assistance in opening of Bank Account;

8. Certificate of Incorporation;

9. 24/7 assistance;

10. Time to time legal updates;


1. Who regulates Nidhi Company?

As per RBI Ref.DNBS.(PD).CC.No. 12 /02.01/99-2000 Nidhi company notified under section 620-A of the Companies Act (Now Nidhi Rules 2014) is classified at present as "Mutual Benefit Financial Company" by RBI and regulated by the Bank for its deposit taking activities and by DCA for its operational matters as also the deployment of funds.

2. Can a private company work as Nidhi Company?

No, only a public limited company can operate as Nidhi Company.

3. Which rule of Companies Act, 2013 governs Nidhi Company?

Chapter XXVI Nidhi Rules, 2014 governs Nidhi Companies.

4. What is Net owned fund in respect of Nidhi Companies?

As per rule 3(d) of Nidhi Rules 2014 “Net Owned Funds” means the aggregate of paid up equity share capital and free reserves as reduced by accumulated losses and intangible assets appearing in the last audited balance sheet.

5. Can Nidhi Company carries any other activity like Chit fund?

No Nidhi shall carry on the business of chit fund, hire purchase finance, leasing finance, insurance or acquisition of securities issued by any body corporate.

As per rule 6 of the Rules there are some restriction or prohibition on working of Nidhi Company which are below given

Nidhi Company shall not:

1. Carry business of Chit Fund

2. Issue preference share or any other debt instrument

3. Open current account with members

4. Carry on any business other than the business of borrowing or lending in its own name

5. Accept deposits from or lend to any person, other than its members (Click here to read deposit and loan rules)

6. Pledge any of the assets lodged by its members as security

7. Take deposits from or lend money to any body corporate

8. Enter into any partnership arrangement in its borrowing or lending activities

9. Issue or cause to be issued any advertisement in any form for soliciting deposit:

10. Pay any brokerage or incentive for mobilising deposits from members or for deployment of funds or for granting loans.

6. What is minimum number of members for Nidhi Company?

Number of Membership should not be reduced to less than 200 members at any time.

7. Who can be Director of Nidhi Company?

Besides being qualified to act as Director as per section 152 and 164 of the Companies Act 2013, provisions as given in Rule 17 of Nidhi Rules should also be adhered:

Director shall be member of Nidhi Company

Term should be 10 consecutive years

Reappointment after cooling off of 2 year

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