India : +91 9894123480 info@apnalegal.com
Knowledge Center | Income Tax | GST Filing

How To Register An Nidhi Company

It's ideal for those businesses looking to start a permanent and a mutual benefit fund, or a mutual benefit company.

One DSC & Three DINs

The directors must be registered with the MCA.

Step 1

Company Name Reservation

Deciding on a company name and registering it

Step 2

RBI Approval

Approval from RBI

Step 3

An Overview

Nidhi Company Registration

A Nidhi Company is a type of Non-Banking Financial Corporation (NBFC) which is regulated and governed by the provisions of the Companies Act, 2013. Significant difference of this business model from other companies is that it deals only with deposits from and loans to its members (shareholders). The deposits by the members are used to provide loans or advances to the members themselves, and to acquire government-issued stocks/bonds/debentures/securities. Hence this company is based on the principle of Mutual Benefits.

Further, it is to be noted that though the company is regulated by the Ministry of Corporate Affairs this business structure do fall under the ambit of Reserve Bank of India(RBI), as it is similar to that of an NBFC. However, there are no separate registrations to be done under RBI for a Nidhi company and RBI has excused this Company from the core provisions of the RBI Act, 1934 and other regulations prevalent on an NBFC, as these Companies deals only with the money of its shareholders or members.

Know MoreReach in WhatsApp
Nidhi Company

Benefits

  • Ease To Borrow:As a member, one can borrow money at a minimum rate, relative to the rate at which banks lend money. This can be a major advantage in times of need, as different individuals in the mutual benefit society are likely to need funds at different points in time.
  • Encourages Savings:It encourages all its members to save money and encourages a thrifty lifestyle. A Nidhi Company, after all, is a mutual benefit society wherein members can lend or borrow money and accept financial aid amongst them.
  • Less Complications:Borrowing and lending to known persons, where the procedure is fixed, is much less complicated than dealing with banks or in an informal setting. A Nidhi Company enables its members to unlock the potential of their money and gain from lower interest rates when they require money themselves.
  • Simple Registration Process
  • Low Capital required for Registration
  • Limited RBI Regulations
  • No External intervention in Management
  • Benefits to the members
For More Details

Contact us