Nidhi Company Registration / Open Nidhi – Company

Websoftex Software Solutions can register a Nidhi Company in 20 to 30 days, subject to ROC processing time.

1) Obtaining DSC & DIN Digital Signature Certificate (DSC) and Director Identification Number (DIN) is required for the proposed Directors of the Nidhi Company. DIN and DSC can be obtained for the proposed Directors within 5 to 7 days.

2) Name Approval & License Once DIN and DSC are available for at least three Directors; application for reservation of name for Nidhi Company can be made to MCA. Name approval can be obtained in 3 to 5 working days.

3) Nidhi Registration Once the name approval is obtained, registration documents can be submitted to the MCA along with an application for registration. MCA will usually approve the application for incorporation in 5 to 7 days, subject to their processing time. These following primary documents are required from the Promoter Directors and Members at the initial stage:

  1. Xerox copy of Pan Card and Voter Card/Aadhaar Card, Three nos. original Pass-Port size photographs of Directors and Members of the Board;
  2. Current Mobile No. of Directors and Members of the Board;
  1. Documents of the Registered Office of the Company (Latest Tax Bill, Electricity Bill, Pan Card, Voter Card/Aadhaar card (Xerox) of the Owner of the premises where the registered office will be situated;
  1. Telephone No, Police station Details and Post office Details including Land line Phone No. of the Jurisdiction of the registered office of the company;

Nidhi Company Governing Law.

Nidhi Company is governed by Nidhi Rules, 2014. Nidhi companies are incorporated in the nature of Limited company and hence, they have to comply with two set of norms, one of Public limited company as per Companies Act, 2013 and another is for Nidhi Rules, 2014. No RBI approval is necessary to register the Nidhi Company. RBI has specifically exempted this category of NBFC in India to comply with its core provisions such as registration with RBI etc.

Now, if anybody wants to register a Nidhi Company in India, then they must look into these vital points

  1. Deals only With Members: If you are registering Nidhi Company, so to deal with public at large, then this point might break your heart. As per law, Nidhi Company can only deal with its members. In other words, it means that it can accept deposit and provide loans only to its members.
    Further Nidhi shall not admit a body corporate or trust as a member.
  1. The Requirement after incorporation: The things after incorporation are known as post compliance. Unlike other companies, Nidhi Companies compliances are complicated and very important. You just cannot afford to miss those. Here is the list of requirement that you need to be complied with:

    a) Nidhi limited should have at least two hundred members to avoid being in default with Rule 5 of Nidhi Rules, 2014.

    b) Net Owned Funds (capital invested) should not be less than ten lakh.

    c) Ratio of Net owned funds to deposits should not be more than 1:20. In other words, if you have total Net owned Funds of INR 10 lakh then Nidhi Company can accept maximum deposits up to INR 2 crore.

    d) What if a Nidhi Company cannot reach the member size of 200 within a year? In that case, Company will have to apply for extension with the Regional Director of the company in the Form NDH – 1

  2. The Business Restriction: A Nidhi Company cannot do the following types of business as they are strictly prohibited by the rules.

    a) Business of chit fund, hire purchase finance, leasing finance, insurance or acquisition of securities issued by anybody corporate.

    b) Further, it shall not carry on any business other than the business of borrowing or lending in its own name.

  3. General Restrictions: Apart from the business restrictions, there are some general restrictions are also there which are as follows:

    A) Nidhi Company shall not issue preference shares, debentures or any other debt instrument by any name or in any form whatsoever.

    B) Nidhi Company shall not open current account with its members. Please note, there is a restriction on current account that means you can still open saving account with the members.

    C) A Nidhi Company cannot issue or cause to be issued any advertisement in any form for soliciting deposit.

    D) Nidhi Company cannot pay any brokerage or incentive for mobilizing deposits from members or for deployment of funds or for granting loans.

  1. E) No Nidhi Company shall pledge any of the assets lodged by its members as security.

  1. F) No Nidhi Company shall accept deposits from or lend to any person, other than its members.

    G) No Nidhi Company shall take deposits from or lend money to anybody corporate.

  2. H) No Nidhi Company shall enter into any partnership arrangement in its borrowing or lending activities.
  3. I) No Nidhi Company shall acquire another company by purchase of securities or control the composition of the Board of Directors of any other company in any manner whatsoever or enter into any arrangement for the change of its management.
    Unless it has passed a special resolution in its general meeting and also obtained the previous approval of the Regional Director having jurisdiction over such Nidhi.
  4. J) Nidhi company can accept a deposit of maximum of 60 months.
  5. K) Nidhi company cannot deal in Motor Finance.
  1. Minimum Share Requirements: Nidhi Company has to allot at least 10 equity shares or shares equivalent to one hundred rupees. However, savings account holder and a recurring deposit account holder shall hold at least one equity share of rupees ten.
  2. Branches of Nidhi Company: A Nidhi Company can open 3 branches in its district only if it has earned profits after tax continuously during the preceding three financial years. For any additional branch, Nidhi will be first apply for approval from the Regional Director.
  3. Rate of Interest: The rate of interest to be charged on any loan given by a Nidhi shall not exceed seven and half per cent above the highest rate of interest offered on deposits by Nidhi and shall be calculated on reducing balance method. Nidhi shall charge the same rate of interest on the borrowers in respect of the same class of loans and the rates of interest of all classes of loans shall be prominently displayed on the notice board at the registered office and each branch office of Nidhi.
  4. Nidhi Company Loans [Rule 15]
    A Nidhi shall provide loans only to its members.
    The loans given by a Nidhi to a member shall be subject to the following limits, namely:

    A) two lakh rupees, where the total amount of deposits of such Nidhi from its members is less than two crore rupees;

  1. B) seven lakh fifty thousand rupees, where the total amount of deposits of such Nidhi from its members is more than two crore rupees but less than twenty crore rupees;

    C) twelve lakh rupees, where the total amount of deposits of such Nidhi from its members is more than twenty crore rupees but less than fifty crore rupees; and

    D> fifteen lakh rupees, where the total amount of deposits of such Nidhi from its members is more than fifty crore rupees.

    Where a Nidhi has not made profits continuously in the three preceding financial years, it shall not make any fresh loans exceeding fifty per cent of the maximum amounts of loans specified in clauses (a), (b), (c) or (d). A member shall not be eligible for any further loan if he has borrowed any earlier loan from the Nidhi and has defaulted in repayment of such loan. The amount of deposits shall be calculated on the basis of the last audited annual financial statements.

    A Nidhi shall give loans to its members only against the following securities, namely:

    A) gold, silver and Jewellery; The re-payment period of such loan shall not exceed one year.

    B) Immovable property; The total loans against immovable property [excluding mortgage loans granted on the security of property by registered mortgage, being a registered mortgage under section 69 of the Transfer of Property Act, 1882 (IV of 1882)] shall not exceed fifty per cent of the overall loan outstanding on the date of approval by the board, the individual loan shall not exceed fifty per cent of the value of property offered as security and the period of repayment of such loan shall not exceed seven years.

    C) Fixed deposit receipts, National Savings Certificates, other Government Securities and insurance policies: Such securities duly discharged shall be pledged with Nidhi and the maturity date of such securities shall not fall beyond the loan period or one year whichever is earlier. In the case of loan against fixed deposits, the period of loan shall not exceed the unexpired period of the fixed deposits.

What is Nidhi Company?

A Nidhi company is one that belongs to the non-banking Indian Finance sector and is recognized under section 406 of the Companies Act, 2013. Their core business is borrowing and lending money only between their members.

They are also known as Permanent Fund, Benefit Funds, Mutual Benefit Funds and Mutual Benefit Company. It is regulated by Ministry of Corporate Affairs. Reserve Bank of India is empowered to issue directions to them in matters relating to their deposit acceptance activities. However, in recognition of the fact that these Nidhi Company deal with their shareholder members only.

Nidhi Companies were existed even prior to the existence of companies Act 1913. The basic concept of Nidhi is “Principle of Mutuality” (“Paraspara Sahayata”). Thus Nidhi function for the common benefit advantage of all their Members/Share holders..

Why People Register Nidhi Company?

 

Nidhi Company is one of the categories of NBFC or in other words, it is the cheapest and easiest form of NBFC as well. Also, it is very easy form to register and does not require much capital. Anybody can register a Nidhi Company with only 5 lakh minimum capital and with minimum of seven members.

 

Through, there are various restrictions as well, but we look at its cost involved, we can say it is a small and legal ways to start the finance business in India. When you business grew a lot in this, then you can anytime graduate to a full fledge Non-Banking Financial Company.

Nidhi Company Overview:

Dear my all friend today we going to discuss about Nidhi company

Business of finance without being registered anywhere, due to this, they have to either close down their business or face the many people in India do the penal consequence of law. The main reason behind being unregistered is the cost and time involved in the registration.

In India, only banks and Non-Banking Financial Companies (NBFC) are allowed to do business of finance. Unlike Banks, NBFC requires lesser capital to start with but that too is large for a small business man. The minimum capital requirement for NBFC is Two crore.  Other than capital, there are various other restrictions as well like stringent regulations, capital adequacy norms, Provisioning norms etc.

Websoftex Nidhi and Producer Company Software

We operate by making the computer code with you then running it on our servers. However area unit we tend to able to do this? Through collaboration and versatile operating and by operating along for our mutual advantages. Our experience in computer code development is value-added to your insight and in-depth data of your trade and also the tasks you wish to attain to form your business run a lot of with efficiency.

We tend to license the computer code for your use, however we tend to area unit liberated to take what we’ve learnt, and sell tools to similar corporations. You get the computer code you wish. We tend to develop a product or service we will market a lot of wide. It’s a win-win state of affairs that advantages everybody. We’ve tons of shoppers in India.

We believe quality consists of merchandise and services provided on time and in agreement with client necessities. We tend to shall acknowledge and respect our customers’ right to receive quality merchandise and services, on time and among budget.

  • Software options
  • Master Entry Module
  • Branch Master
  • Region Master
  • State Master
  • Set up Master
  • Rank Master
  • Commission Master
  • Relation Master
  • Bank Master
  • Configuration Master
  • Target Master
  • Prize Master
  • Voucher Master
  • Account Master
  • Dividend Master
  • Maturity Master
  • Loan Master
  • Interest Master
  • fiscal year Master

Websoftex Software Solutions is specialized software for all Credit Cooperative Societies, Nidhi Mutual profit firms and small Finance firms. It’s the most effective software resolution for credit cooperative society, Nidhi mutual profit company and small node repository financial institution out there within the market these days purchasable in Bangalore, Hyderabad, Chennai, Kerala, Delhi, Jaipur, Lucknow, and Indore and throughout Asian nation. Websoftex Software Solutions are often made-to-order to fulfill the shopper’s actual needs for his or her Nidhi Company, Co-operative Society or small node repository financial institution.

What is NIDHI PRAYAAS Program?

The NIDHI – Promoting and fast Young and Aspiring technology entrepreneurs (NIDHI-PRAYAS), the theme launched could be a pre-incubation initiative; specifically supports young innovators flip their concepts into proof-of-concepts. This support shall permit the innovators to do their concepts without worrying of failure, permitting them to succeed in a stage wherever the innovators / entrepreneurs have a prepared product and ar willing to approach incubators for commercialization.

 Objectives of NIDHI-PRAYAS Program:

  • To change translation of associate innovative plan to a image.
  • To supply a platform for quicker experimentation and modify approaches within the plan to plug journey.
  • To come up with innovative solutions relevant to the native and world issues.
  • To draw in an oversized variety of youth WHO demonstrates downside finding zeal and skills
  • To figure on their new technology / knowledge / innovation based mostly startups.
  • To reinforce the pipeline in terms of quality and amount of innovative startups to the incubators.
  • To create a spirited innovation scheme, by establishing a network between innovators, academia, mentors and incubators.

Nidhi Pvt Ltd

Nidhi within the Indian context / language suggests that “TREASURE”. However, within the Indian monetary sector it refers to any mutual profit society notified by the Central / Union Government as a Nidhi Company. They’re created principally for cultivating the habit of thrift and savings amongst its members.

 the businesses doing Nidhi business, viz. borrowing from members and loaning to members solely, square measure best-known underneath totally different names like Nidhi, Permanent Fund, profit Funds, Mutual profit Funds and Mutual profit Company.

Nidhi Company square measure additional well-liked in South Republic of India and square measure extremely localized single workplace establishments. They’re mutual profit societies, as a result of their dealings square measure restricted solely to the members; and membership is proscribed to people.

The principal supply of funds is that the contribution from the members. The loans square measure given to the members at comparatively affordable rates for functions like house construction or repairs and square measure usually secured. The deposits mobilized by Nidhi Company aren’t a lot of compared to the organized banking sector.

Since Nidhi Company come back underneath one category of NBFCs, run is scattered to issue directions to them in matters about their deposit acceptance activities. However, in recognition of the very fact that these Nidhi Company take care of their shareholder-members solely, run has exempted the notified Nidhi Company from the core provisions of the run Act and different directions applicable to NBFCs. As on date (February 2013) run doesn’t have any such that regulative framework for Nidhi Company.

Nidhi Producer company FAQ

Who is a member of a PC?

Any individual engaged in any activity connected with or relatable to any primary manufacture.

 

Is there any restriction in range of members i.e. will there be fifty or additional members?

There is no restriction in most range of members. Numbers of members of a computer is fifty or additional.

 

Can the shares of a computer be listed in any Stock Exchange?

As provided in alphabetic character half-dozen on top of, a computer will ne’er be a Public Ltd., thus its will ne’er be listed in an exceedingly stock market.

 

Is there any restriction in space of operation of a PC?

Since a computer is incorporated as a Pvt. Ltd. Company, it’s no restriction in having business in any a part of entire Union of Asian nation [Section 581 E(2) of the businesses Act, 1956]. it should additionally expand its business in foreign countries additionally, that shall be as per alternative applicable statute and is extremely abundant doable.

 

Is there any tax profit for investors in debentures of a PC?

There are a unit bound tax edges in reference to Dividends and TDS edges on annual Interest on investment in Debentures of a computer.

 

Who area unit the restrictive Authorities?

The mythical monster underneath Ministry of company Affairs is that the solely administrative body.

Nidhi Company Analysis:

No business apart from Nidhi business:

A Nidhi company cannot carry a business as a result of Nidhi company carries a predefined business and thus not allowed to hold on business as the other sort

No preference share capital:

An Old North State cannot raise funds by ways that of preference share capital since Nidhi Company is allowed to require deposits from the general public, it’s been restricted to lift funds from the other supply

No current a/c

An Old North State has been restricted to open the present account with members. Nidhi Company isn’t treated as industrial company rather it’s a mutual profit company

Deals solely with members

An Old North State cannot agitate a person apart from its members. in alternative words, a Nidhi company will solely take cash or lend cash to its members solely

No branch outside state

An Old North State cannot open a branch outside the state in Bharat in line with rules

No branch before 3 years

An Old North State cannot open a branch in Bharat until it earned profit endlessly in 3 preceding years. This is often necessary

No charge on membership

An Old North State cannot charge a charge on a problem on shares from the members. However, a Nidhi company will charge process fees on loans because the same has not been restricted by Nidhi rules