Register a Nidhi Company to legally operate a member-based financial institution in India focused on mutual savings and lending among its members under the Companies Act, 2013.
A Nidhi Company is a type of company registered under the Companies Act, 2013 and Nidhi Rules, 2014, with the core objective of promoting the habit of savings and providing loans to its members for their mutual benefit. Unlike other NBFCs, Nidhi companies do not require approval from the Reserve Bank of India (RBI) for registration, as they are governed by the Ministry of Corporate Affairs (MCA). To qualify as a Nidhi Company, the business must be incorporated as a Public Limited Company, have prescribed minimum capital and members, and comply with ongoing membership and fund requirements. Once incorporated and meeting conditions, the company may file for Nidhi status and carry out deposit and loan activities exclusively among its members.
Encourages a culture of savings among members through structured deposit acceptance.
Simpler and quicker to register compared to other NBFCs since RBI approval is not required.
Allows the company to lend to members, fostering financial support within the community.
Members enjoy limited liability per their share contribution under a company structure.
Provides a legal structure under MCA and Nidhi Rules, ensuring transparent operations.
Enables members to access loans and savings products within a mutual benefit network.
Focuses on benefits to members rather than external investors.
Ensures consistent reporting and standards for deposits and member services.
Directors apply for Digital Signature Certificates (DSC) and Director Identification Numbers (DIN) for MCA filings.
Propose and reserve a unique company name with proper suffix as per MCA guidelines.
Draft the Memorandum of Association and Articles of Association specifying the core objective of savings and lending among members.
File the SPICe+ incorporation application with all required documents and prescribed forms.
Receive the Certificate of Incorporation from ROC followed by additional compliance filings to complete registration.
Discuss requirements for members, capital, and compliance with a company law professional.
Gather identity proofs, address proofs, DSC, DIN, MoA and AoA drafts, and office address proofs.
Submit incorporation forms with MCA using SPICe+ along with prescribed attachments.
Complete member additions and minimum fund requirements to maintain Nidhi Company status.
Delayed or non-compliance with MCA requirements.
How to avoid: Ensure minimum initial members and later grow membership to statutory thresholds.
Rejection or regulatory issues.
How to avoid: Clearly state savings and lending among members in the MoA.
Inability to file incorporation forms.
How to avoid: Obtain DSC and DIN for all directors early in the process.
Loss of Nidhi status or penalties.
How to avoid: Meet membership, net-owned funds, and compliance within required timelines.
It is a company registered under the Companies Act, 2013 to promote savings and lending amongst its members for mutual benefit.
A minimum of 7 members are required initially, and within one year it must have at least 200 members.
No, Nidhi Company registration does not require RBI approval but must comply with MCA guidelines.
At least ₹5 lakh in paid-up equity share capital is required at registration.
No, they can accept deposits and lend only to registered members.
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