Nidhi Company Registration & Compliance in India
A Nidhi Company is a type of non-banking financial company (NBFC) recognized under Section 406 of the Companies Act, 2013, primarily formed to borrow and lend money among its members. The objective is to encourage the habit of savings among members and provide low-cost credit facilities.
Nidhi Companies are governed by the Nidhi Rules, 2014, and monitored by the Ministry of Corporate Affairs (MCA). Unlike banks or other NBFCs, Nidhi Companies cannot raise funds from the general public, engage in chit funds, insurance, hire purchase, or financial activities beyond lending to members.
📌 Key Features of a Nidhi Company
- Formed to encourage savings and mutual financial assistance among members.
- Must have minimum 7 members at incorporation and 3 directors.
- Operates as a public company under the Companies Act, 2013.
- Deposits can be accepted only from members, and loans can be provided only to members.
- Name must end with “Nidhi Limited”.
- Profits are used to pay interest on deposits and other member benefits.
- Adherence to Nidhi Rules, 2014 ensures proper fund management, member protection, and legal compliance.
📌 Eligibility Criteria
- Minimum 7 members and 3 directors at incorporation.
- Registered office must be in India with proof of ownership or NOC from the owner.
- Compliance with Nidhi Rules, 2014 regarding net owned funds (minimum ₹5 lakh), member limits, and lending/deposit ratios.
- Directors must have Digital Signature Certificates (DSC) and Director Identification Number (DIN).
📌 Documents Required
- Identity proof (PAN, Aadhaar, Passport, Voter ID) of directors and members.
- Address proof of directors and members.
- Proof of registered office (utility bill, rental agreement, or NOC).
- Memorandum of Association (MoA) and Articles of Association (AoA) drafted according to Section 406 of the Companies Act, 2013 and Nidhi Rules, 2014.
- Board resolutions authorizing director appointments and operational decisions.
📌 Advantages of a Nidhi Company
- Limited Liability: Liability of members is limited to the shares they hold.
- Encourages Savings: Provides a secure platform for members to deposit funds.
- Low Regulatory Burden: Simplified compliance under Nidhi Rules, 2014.
- Member-Centric Operations: Only members benefit from deposits, loans, and interest.
- Access to Low-Cost Loans: Members can access financial support at lower interest rates compared to commercial banks.
- Governance and Transparency: Mandatory bookkeeping, annual audits, and filings ensure compliance and transparency.
- Compliance with Law: Ensures adherence to Section 406 of the Companies Act, 2013, Nidhi Rules, 2014, and MCA regulations.
📌 Our Nidhi Company Services Include
- Incorporation & Licensing:
- Drafting MoA and AoA in compliance with Section 406 and Nidhi Rules, 2014.
- Filing incorporation forms with Registrar of Companies (RoC).
- Assisting with DIN, DSC, and director filings.
- Obtaining Certificate of Incorporation and registering with MCA.
- Post-Incorporation Compliance & Accounting:
- Bookkeeping, accounting, and maintenance of statutory registers in accordance with Companies Act, 2013.
- Filing annual returns and financial statements (Form AOC-4, MGT-7).
- Monitoring compliance with Nidhi Rules, 2014, including net owned fund, member limit, and deposit-to-loan ratios.
- Preparation of board meeting minutes, resolutions, and statutory reports.
- Support for internal audits and regulatory audits.
- Financial Management & Advisory:
- Guidance on accepting deposits and issuing loans within regulatory limits.
- Assistance in interest calculation, dividend allocation, and member benefits management.
- Structuring financial policies to comply with Section 406 of Companies Act, 2013, and Nidhi Rules, 2014.
- Advisory on improving member engagement, financial health, and sustainable operations.
- Governance & Risk Management:
- Ensuring compliance with all MCA regulations and applicable sections.
- Conducting risk assessments and advising on mitigating financial and operational risks.
- Representation before authorities in case of regulatory scrutiny or compliance queries.
📌 Why Partner With India Stat Filing
- Experienced professionals handling Nidhi Company registration, bookkeeping, compliance, and audit support.
- End-to-end support from incorporation to post-registration compliance.
- Accurate guidance on regulatory requirements under Companies Act, 2013 (Section 406) and Nidhi Rules, 2014.
- Transparent pricing and real-time updates on filings, compliance, and audits.
- Expertise in member-centric operations, deposit management, and statutory reporting.
📌 Our Commitment
India Stat Filing ensures your Nidhi Company is legally compliant, financially transparent, and professionally managed. From registration and document drafting to bookkeeping, audits, and statutory compliance, we manage all requirements so members can focus on mutual savings and financial growth.
📞 Get Started Today
Form your Nidhi Company with India Stat Filing for end-to-end registration, compliance, bookkeeping, and financial management with confidence, transparency, and regulatory adherence.
What is a Nidhi Company?
A Nidhi Company is a type of non-banking financial company (NBFC) that primarily focuses on borrowing and lending money among its members. Moreover, it operates under the Companies Act, 2013 and is regulated by the Ministry of Corporate Affairs (MCA), not the RBI. Additionally, Nidhi Companies promote financial inclusion and small savings by encouraging deposits from members. Consequently, they are ideal for people seeking mutual benefit within a closed group while ensuring legal compliance and trust-based financial operations.
How to start a Nidhi Company in India?
To start a Nidhi Company in India, first incorporate a public limited company under the Companies Act, 2013 with at least seven members and three directors. Then apply for approval with the Ministry of Corporate Affairs (MCA) by submitting required documents like MOA, AOA, identity proofs, and registered office address. Moreover, comply with Nidhi Rules, 2014, including member deposits and lending regulations. Additionally, maintain proper accounts and statutory registers. Consequently, following these steps ensures legal compliance and smooth operations while fostering member trust.
What is the Nidhi Company registration process?
The Nidhi Company registration process begins by incorporating a public limited company under the Companies Act, 2013 with at least seven members and three directors. Then, prepare and submit the MOA, AOA, identity proofs, and registered office address to the Ministry of Corporate Affairs (MCA) for approval. Moreover, comply with Nidhi Rules, 2014 regarding deposits, lending, and membership. Additionally, maintain proper statutory registers and accounts. Consequently, following this process ensures legal compliance, credibility, and smooth operation of the Nidhi Company.
What are the documents required for Nidhi Company registration?
To register a Nidhi Company in India, several documents are essential. Firstly, provide identity and address proofs of directors and members, including PAN and Aadhaar. Moreover, submit Memorandum of Association (MOA), Articles of Association (AOA), and registered office proof. Additionally, include No Objection Certificate (NOC) from the property owner and bank account details. Consequently, ensuring complete and accurate documentation helps secure MCA approval, establishes legal compliance, and allows the Nidhi Company to operate smoothly and build trust among members.
What is the minimum capital required to start a Nidhi Company?
The minimum capital required to start a Nidhi Company in India is ₹5 lakh, which acts as the initial deposit to facilitate lending and borrowing among members. Moreover, at least 200 members must be enrolled within the first year to comply with Nidhi Rules, 2014. Additionally, proper maintenance of statutory registers and financial records is mandatory. Consequently, having adequate capital and following regulatory requirements ensures legal compliance, smooth operations, and builds trust among members for a sustainable financial setup.
Who can start a Nidhi Company?
A Nidhi Company can be started by any Indian citizen who is at least 18 years old and willing to comply with the Nidhi Rules, 2014. Moreover, the promoters must act as members and maintain the minimum number of members and directors required. Additionally, the individual should have a clear understanding of deposit collection and lending activities. Consequently, following the legal framework ensures smooth registration, operational compliance, and fosters trust among members for safe and reliable financial transactions.
What is the difference between a Nidhi Company and an NBFC?
A Nidhi Company is a type of non-banking financial company (NBFC) that primarily lends and borrows funds only among its members, whereas a regular NBFC can operate with the general public and offer a broader range of financial services. Moreover, Nidhi Companies are regulated by the Ministry of Corporate Affairs (MCA), while NBFCs fall under the RBI’s supervision. Additionally, compliance requirements and capital structures differ significantly. Consequently, choosing the right structure depends on the business model, target audience, and regulatory preferences.
Can a Nidhi Company accept deposits from the public?
No, a Nidhi Company cannot accept deposits from the general public; it is legally allowed to collect deposits only from its registered members. Moreover, the company must comply with Nidhi Rules, 2014, including maintaining minimum members and statutory reserves. Additionally, all lending and borrowing activities are restricted within the member base. Consequently, adhering to these regulations ensures legal compliance, builds trust among members, and allows the company to operate smoothly while providing mutual financial benefits safely.
How long does Nidhi Company registration take?
Nidhi Company registration in India typically takes 2 to 4 weeks, depending on the completeness and accuracy of the submitted documents. Moreover, prompt submission of the MOA, AOA, director and member KYC, and registered office proof can expedite the process. Additionally, adherence to Nidhi Rules, 2014 and timely responses to MCA queries play a crucial role. Consequently, careful preparation and professional assistance ensure smooth approval, legal compliance, and a faster start to member-based financial operations.
What is the tax structure for a Nidhi Company?
Nidhi Company registration in India typically takes 2 to 4 weeks, depending on the completeness and accuracy of the submitted documents. Moreover, prompt submission of the MOA, AOA, director and member KYC, and registered office proof can expedite the process. Additionally, adherence to Nidhi Rules, 2014 and timely responses to MCA queries play a crucial role. Consequently, careful preparation and professional assistance ensure smooth approval, legal compliance, and a faster start to member-based financial operations.