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Overview of Nidhi company
Overview of
Nidhi company
A Nidhi company is a type of non-banking finance company that operates in India under the guidelines set forth by the Ministry of Corporate Affairs. It is a mutual benefit society that primarily focuses on accepting deposits from its members and providing loans to them at competitive rates of interest. The primary objective of a Nidhi company is to encourage savings and provide financial assistance to its members in the form of loans.
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The government has strict rules and regulations that Nidhi businesses must follow to, including keeping a minimum net worth, purchasing government securities, and leaving aside a percentage of their income as reserves. In order to make sure they are working within the law, they are moreover the subject of regular audits and inspections.
Overall, Nidhi firms are important to India's economic development through offering financial services to individuals and small businesses in India.
Benefits of Nidhi
company Registration
Here are some of the benefits of registering a Nidhi company in India:
Legal Recognition:
A Nidhi corporation that has been registered benefits from legal recognition and follows the rules established by the Ministry of Corporate Affairs.
Access to Funding:
Nidhi companies offer competitive interest rates on deposits and loans, providing members with an attractive investment opportunity.
Better Interest Rates:
By accepting deposits from its members, a Nidhi company helps to encourage savings and promote financial stability.
Increased Savings:
The mutual nature of the firm makes it possible for improved profits and cheaper prices for members because the cost of operations is relatively low.
Low Cost of Operations:
Members of a Nidhi company have easy access to loans, making it easier for them to meet their financial needs.
Easy Loan Availability:
Members of a Nidhi company have easy access to loans, making it easier for them to meet their financial needs.
Better Credit Ratings:
A registered and well-managed Nidhi company can enjoy better credit ratings, making it easier to access funding from other sources.
Easy Compliance:
Nidhi companies are required to follow strict guidelines and regulations set forth by the government, making it easier for them to comply with regulations and avoid legal issues.
Documents Required for Nidhi company registration
- Here are the documents required for registering a Nidhi company in India:
- PAN (Permanent Account Number) card of all proposed directors
- Proof of address (Aadhaar, Voter ID, or Passport) for all proposed directors
- Proof of identity (Aadhaar, Voter ID, or Passport) for all proposed directors
- Business address proof (utility bill or lease agreement)
- Memorandum of Association (MOA) and Articles of Association (AOA) of the company
- NOC (No Objection Certificate) from the owner of the business premise
- Affidavit by the first directors of the company
- Affidavit by the promoter(s) of the company
- Declarations by the first directors of the company
- Request for DIN for directors
- Request for name availability
- PAN and TAN (Tax Deduction and Collection Account Number) application for the company
Nidhi company registration
Eligibility Criteria For Nidhi Company registration
The eligibility criteria for registering a Nidhi company in India include the following:
Minimum number of members:A Nidhi company must have at least 200 members.
Minimum paid-up capital: The minimum paid-up capital required to register a Nidhi company is Rs. 10 lakhs.
Director eligibility: All directors of a Nidhi company must be citizens of India and have a minimum age of 21 years.
Company name: TThe name of the Nidhi company must end with the words “Nidhi Limited” and must be approved by the Registrar of Companies.
Objectives: The objectives of the Nidhi company must be in line with the provisions of the Nidhi Rules 2014.
Location: The registered office of the Nidhi company must be located within India.
Filing of returns: The Nidhi company must file annual returns with the Registrar of Companies and comply with all other regulatory requirements.
Essential forms to file for Nidhi company registration
Here are the essential forms to be filed for Nidhi company registration in India:
Form SPICe (INC-32): This form is used to incorporate a company and serves as a combined form for MOA and AOA.
Form DIR-12: This form is used to appoint the first directors of the company.
Form INC-33: This form is used to file the MOA and AOA of the company.
Form INC-34: This form is used to file the declaration of compliance with the provisions of the Companies Act, 2013.
Form INC-35: This form is used to file a notice of the situation of the registered office of the company.
Form MGT-14: This form is used to file the resolution for appointment of the auditor.
Form INC-22: This form is used to file a notice of the change of registered office of the company. Form NDH-1: This form is used to apply for a certificate of registration as a Nidhi company.
PSR Compliance Assistance
The process of registering a Nidhi company involves adhering to many requirements, preparing documents, and complying with pre-incorporation and post-incorporation compliances. Moreover, complying with specific MCA mandates is imperative to avoid incurring hefty penalties and late fees. This process can seem daunting and confusing without professional assistance. PSR Team provides expert service in the online registration process of one’s company on the MCA website. Our team of experts will assist you every step of the way in your journey to get your company registered
Frequently Asked Questions(FAQ's)
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01. What is a Nidhi Company?A Nidhi Company is a type of Non-Banking Financial Company (NBFC) that is formed to cultivate the habit of thrift and savings among its members. It accepts deposits from its members and lends to its members only.
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03. What is the minimum number of members required to form a Nidhi Company?The minimum number of members required to form a Nidhi Company is seven.
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05. What is the minimum capital requirement to start a Nidhi Company?The minimum capital requirement to start a Nidhi Company is Rs. 5 lakhs.
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07. What are the documents required for Nidhi Company registration?The documents required for Nidhi Company registration include PAN card and Aadhaar card of directors and shareholders, passport size photographs, address proof of registered office, and MOA and AOA.
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09. What is MOA and AOA?MOA stands for Memorandum of Association, which defines the company's objectives and scope of operations. AOA stands for Articles of Association, which defines the company's internal regulations and management structure.
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02. How long does it take to register a Nidhi Company?The registration process of a Nidhi Company usually takes around 15-20 days, subject to government processing time and document verification.
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04. Can a Nidhi Company accept deposits from non-members?No, a Nidhi Company can only accept deposits from its members.
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06. What is the maximum interest rate that a Nidhi Company can offer on deposits?The maximum interest rate that a Nidhi Company can offer on deposits is prescribed by the Reserve Bank of India (RBI) and is subject to change from time to time.
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08. What is the annual compliance requirement for a Nidhi Company?A Nidhi Company is required to comply with various annual filing requirements, such as filing of annual returns, financial statements, and income tax returns, as per the Companies Act, 2013. Additionally, it is also required to hold a General Meeting every year.