Nidhi Company

Nidhi Company

Nidhi Company is registered with sole objective of cultivating the habit of thrift and savings amongst its members. Nidhi companies are allowed to take deposit from its members and lend to its members only.

Nidhi Company is one of the typesof Non-Banking Financial Company (NBFC) which does not require any RBI license.As Nidhi Company deals only with their shareholder-members, RBI has exempted them from the core provisions of the RBI Act and other directions applicable to NBFCs.

A Nidhi to be incorporated under the Act shall be a PUBLIC COMPANY and should have “Nidhi Limited” as the last word of its name.Every Nidhi shall, within a PERIOD OF ONE YEAR from Incorporation ensure that it has-

  • Not less than two hundred members;
  • Net Owned Funds of Rs. 10,00,000 or more;
  • Unencumbered term deposits of not less than 10% of the outstanding deposits.
  • Net Owned Funds to deposits ratio of not more than 1:20

Enquiry Now

Nidhi Company


  • Separate Legal Entity
  • Going Concern
  • Better Credibility
  • Separation of Management & Shareholders
  • Perpetual Succession
  • Helpful for Lower and Middle Classes
  • Low Rates of Interest
  • Secured Investments


  • Minimum Three Directors
  • Minimum Seven Subscriber
  • One Resident Director
  • Capital Requirement
  • Unique Name
  • Prohibited Activities

Procedure for Nidhi Company

Digital Signature of Director

We will start the procedure by applying for Digital Signature Certificates

Verification & Name Approval

The name must be unique and should not be same or similar to an existing company, LLP or a trademark.

Prepare MOA, AOA and other incorporation documents

SPICE Form is filed for incorporation of the company


File incorporation documents & obtain Certificate of Incorporation, PAN, TAN & GSTIN

Opening of Bank Account

Open a Bank Account in the name of the Company and transfer the amount of shares subscribed by the subscribers.

Documents Required for Nidhi Company

  • Passport size photograph of directors & Subscribers
  • Copy of PAN Card of directors & Subscribers
  • Copy of Identity Proof (Voter identity card/Driving license/Passport) of directors & Subscriber
  • NOC from the owner of premises (Format will be provided)
  • Copy of Rent agreement (If rented property)
  • Copy of Property papers (If owned property)
  • Copy of Latest Residential Proof (Bank Statement/Electricity Bill/ Telephone Bill/ Mobile Bill) of directors & Subscriber
  • Latest Utility Bill (Must be Latest)

FAQ on How to Register a Nidhi Company

Nidhi Company is registered as a limited company, under the Companies Act, 2013, with the sole purpose of cultivating the habit of savings amongst its members. The Nidhi companies are allowed to accept deposit from its members and out of that give loan only to their members. Therefore, the funds accumulated by a Nidhi company are only from its members use.
A Nidhi company can advance the following types of loan to its members only
  • Gold Loan
  • Property Loan
  • Loan against FDR and Deposits
  • Loan Against NSC/Government Bonds
  • Micro Finance lending with a cap of 20% Interest
All Unsecured loan is prohibited by Nidhi Company, for exampleVehicle Finance, Chit Fund, Hire-Purchase Finance, Leasing Finance, Insurance or Securities Business.
A Nidhi Company can accept only following kinds of deposits strictly from amongst their members without publication of any advertisement seeking such deposits.
Fixed deposit (FD), Recurring deposit (RD) & Savings Account
Nidhi can pay interest up to 12.5% on FD & RD and 6% on savings accounts.
Nidhi can accept deposits up to 20 times the funds invested. For example, if the Investment is Rs. 5 lakh then deposit up to Rs. 1 Crore can be accepted.
A Nidhi Company is a class of NBFCs and though the RBI is legally empowered to issue directions in matters relating to the deposit acceptance activities of a Nidhi Company. As Nidhi Company deals only with their shareholder-members, RBI has exempted them from the core provisions of the RBI Act and other directions applicable to NBFCs. Therefore, Nidhi Company is an ideal form of business to take the deposit from and lend to a specific group of people.
Only shareholders of the Nidhi Company who have a membership ID, can invest in the scheme. To be a member, you must be 18-years and above and must be a citizen of India.
The word "Nidhi" is a Hindi Word which means "Fund", with respect to a Nidhi Company we can say that it is like a self-help group in a more formal way, with advantages as of NBFC with restriction of dealing only amongst the members of the company. To start a Nidhi Company minimum of seven shareholders and three directors are required. The MOA must contain the sole purpose to operate as a Nidhi Company. All procedural requirements of incorporation of a public limited company are applicable for Nidhi Company as it is primarily a Public Limited Company. Contact us for a detailed one on one consultation for a thorough understanding of the procedural aspect of starting a Nidhi Business in Company form.
Yes, In view of the rules framed by the Government of India/Ministry of Corporate Affairs and RBI which applies strictly on Nidhi Companies, we can say that the deposits are fairly safe with the Nidhi Company.
The investment in a Nidhi Company can be made by the existing members of the Nidhi Company only. To become a member of a Nidhi Company the applicant must be a Citizen of India and legally capable of entering into a valid agreement.
In a Nidhi Company, there is no provision of paying any commission, the incentive of brokerage to agents as the deposits can be accepted or loans can be advanced only to existing members and as such there is a prohibition on open soliciting, marketing or advertising.
Only 3 branches can be opened by a Nidhi Company, provided that the company for the past three years has been earning profits after tax.

What Our Client’s Say