{"id":7366,"date":"2019-11-20T09:00:41","date_gmt":"2019-11-20T03:30:41","guid":{"rendered":"https:\/\/swaritadvisors.com\/learning\/?p=7366"},"modified":"2020-09-30T16:50:22","modified_gmt":"2020-09-30T11:20:22","slug":"nidhi-company-incorporation-procedure","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/","title":{"rendered":"Nidhi Company Incorporation Procedure in India"},"content":{"rendered":"\n<p class=\"has-drop-cap\">A company incorporated to cultivate the habit of saving amidst its members or shareholders falls under Nidhi Company. The dictionary meaning of the term Nidhi is \u2018treasure\u2019. However, in the Indian financial sector, it a mutual benefit society which gets notified by the Central Government. Nidhi companies can solely take a deposit from their members and lend to their members only. <\/p>\n\n\n\n<p>RBI regulates the matters of a Nidhi Company in regards to its deposit acceptance activities. Despite being an NBFC, a Nidhi company has exempted from the core provisions of the RBI Act, 2013 because it works for the welfare of its members. The <strong><em><a href=\"https:\/\/swaritadvisors.com\/nidhi-company-registration\">incorporation of Nidhi Company<\/a><\/em><\/strong> is a lengthy procedure for which one needs to meet the eligibility criteria. So let\u2019s perceive the whole concept of <strong><em>Nidhi Company Registration Process<\/em><\/strong>.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3c0efb74926\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3c0efb74926\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/#Conditions_before_Nidhi_Company_Registration_Process\" title=\"Conditions before Nidhi Company Registration Process\">Conditions before Nidhi Company Registration Process<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/#Post_Registration_Requirements_for_a_Nidhi_Company\" title=\"Post Registration Requirements for a Nidhi Company\">Post Registration Requirements for a Nidhi Company<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/#Documents_Required_for_Nidhi_Company_Registration\" title=\"Documents Required for Nidhi Company Registration\">Documents Required for Nidhi Company Registration<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/#Procedure_for_Nidhi_Company_Registration\" title=\"Procedure for Nidhi Company Registration\">Procedure for Nidhi Company Registration<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/learning\/nidhi-company-incorporation-procedure\/#Conclusion\" title=\"\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\nConclusion\n\n\n\n\n\">\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\nConclusion\n\n\n\n\n<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conditions_before_Nidhi_Company_Registration_Process\"><\/span>Conditions before Nidhi Company Registration Process<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>To set up a Nidhi company one has to comply with the requirements mentioned below: <\/em><\/strong><\/p>\n\n\n\n<ul><li>A company must be a \u201cpublic company\u201d first, before incorporating as a Nidhi Company.<\/li><li>To run a Nidhi Company, one should have a minimum paid-up equity share capital of INR 5 Lakhs.<\/li><li>At the time of incorporation, a company shall not issue any preference shares. In case a company has issued preference shares before the incorporation process. Then those shares must get redeemed as per the terms of the issue.<\/li><li>The objective of a Nidhi should be crystal clear. Primarily the object must be to foster the habit of thrift and savings among its members. Secondly, the company must receive and lend deposits to its members for mutual benefits.<\/li><li>Every company that embraces the activities of a Nidhi shall have the last words as <strong>\u2018Nidhi Limited<\/strong> <a href=\"http:\/\/www.mca.gov.in\/MinistryV2\/nidhicompanies.html\">[1]<\/a> \u2019 at the end of its name.<\/li><li>The minimum number of members and directors at the time of Nidhi Company\u2019s incorporation shall be 7 or more and 3 or more respectively.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Post_Registration_Requirements_for_a_Nidhi_Company\"><\/span>Post Registration Requirements for a Nidhi Company<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Here are the requirements that one has to fulfill after <\/em><span style=\"text-decoration: underline;\"><em>registration of a Nidhi Company<\/em><\/span><em>:<\/em><\/strong><\/p>\n\n\n\n<ul><li>Within a year of its incorporation, a Nidhi Company shall have at least 200 Members. Along with that, the company must have the Net Owned Funds of Rupees 10 Lakhs or more.<\/li><li>It shall have Unencumbered Term Deposit of not exceeding to 10% of its Outstanding Deposits.<\/li><li>The Net owned fund to deposits ratio should be more than 2:1.<\/li><li>If the company does not meet the above requirements within one year of its incorporation, then it shall seek an extension from RD in Form&nbsp;NDH-2<strong>&nbsp;<\/strong>within 30 days of First Financial Year&#8217;s closure.&nbsp; <\/li><li>RD shall permit such orders as may consider appropriate within 30 days of receipt of Application for the extension.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Documents_Required_for_Nidhi_Company_Registration\"><\/span>Documents Required for Nidhi Company Registration<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The <span style=\"text-decoration: underline;\">Nidhi Company Registration<\/span> is an online process for which the applicant should have self-certified documents:<\/em><\/strong><\/p>\n\n\n\n<ul><li>A copy of the PAN Card<\/li><li>Passport size photographs<\/li><li>A copy of Aadhaar Card<\/li><li>Bank Statement\/Telephone Bill\/ Electricity Bill<\/li><li>A proof of the registered office<\/li><li>If the office set is on a rental property, then provide a copy of Rent agreement of office premises that executes on the name of the company.<\/li><li>A copy of the latest Water\/Gas\/Utility bill of the registered office<\/li><li>NOC (<strong>No Objection Certificate<\/strong>) from the landlord stating he has no objection for utilizing his premises as a registered office of Nidhi Company.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Procedure_for_Nidhi_Company_Registration\"><\/span>Procedure for Nidhi Company Registration<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>It is utmost essential to incorporate a limited company under the Companies Act, 2013 before establishing a Nidhi Company in India. The applicant has to ensure the presence of a minimum of 7 members and 3 directors to start with the registration process. Usually, it takes around 45 days for the completion of this process. Follow these easy steps for registration:<\/em><\/strong><\/p>\n\n\n\n<ul><li>The first and foremost thing that an applicant has to do is to apply for (DIN) <strong><em>Director Identification Number<\/em><\/strong> and (DSC) <strong><em>Digital Signature Certificate<\/em><\/strong>. Mostly it takes 2 days for the Procurement of DSC.<\/li><li>Further, it requires the directors and shareholders to draft MOA and AOA. <\/li><li>Note that the Ministry of Corporate Affairs will issue DIN to the directors of your company.<\/li><li>Since the entire <strong><em>registration process of the Nidhi Company<\/em><\/strong> is online, you have to submit all the documents online. Besides, don&#8217;t forget to verify the authenticity of your documents.<\/li><li>As soon as you obtain DIN and DSC, file an application in INC-1 to the Ministry of Corporate Affairs for reservation of name of your Nidhi Company.<\/li><li>Ensure that the name of your company is unique and doesn&#8217;t resemble other companies. Also, it should not be undesirable in consideration of the Central Government.<\/li><li>It is mandatory to add &#8216;<strong><em>Nidhi Limited<\/em><\/strong>&#8216; to the name of a Nidhi Company.<\/li><li>Once you get an approval for the company&#8217;s name by MOCA, it&#8217;s time to prepare for Memorandum of Association (MOA) and Articles of Association (AOA). <\/li><li>Keep in mind the objective of your company while preparing MOA and AOA. <\/li><li>Now apply for incorporation of Nidhi Company.<\/li><li>After the Incorporation Certificate has issued to you; it&#8217;s suitable for you to apply for the PAN and TAN of the company. <\/li><li> Lastly, open a current bank account.<\/li><\/ul>\n\n\n\n<p><strong><em>Note:<\/em><\/strong> A Nidhi applicant must get <strong><a href=\"https:\/\/swaritadvisors.com\/gst-registration\"><em>GST registration<\/em><\/a><\/strong>. All the business entities in India who exceed the threshold limit of turnover or profits have to oblige GST rules. If one fails to do that for tax evasion, then it gets considered as a criminal offence which is subject to prosecution, jail term, and penalties.  <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\nConclusion\n\n\n\n\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><div class=\"shadow4\">By attaining the assistance of an experienced professional, the incorporation process of a Nidhi Company becomes much easier. Even though you may have grasped the concept of Nidhi registration, there are chances of committing a mistake. Therefore, clench onto the services of Swarit Advisors to ease the Nidhi Company Registration. We provide an exclusive package that will help you throughout the incorporation of Nidhi.&nbsp;  <\/div><\/p>\n\n\n\n<div class=\"read\"><p><b>Also Read:<\/b> <mark><a href=\"https:\/\/swaritadvisors.com\/learning\/the-ultimate-revelation-of-nidhi-company-rules-and-regulations\/\" target=\"_blank\" rel=\"noopener noreferrer\">The Ultimate Revelation of Nidhi Company Rules and Regulations<\/a><\/mark>.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>A company incorporated to cultivate the habit of saving amidst its members or shareholders falls under Nidhi Company. The dictionary meaning of the term Nidhi is \u2018treasure\u2019. However, in the Indian financial sector, it a mutual benefit society which gets notified by the Central Government. Nidhi companies can solely take a deposit from their members [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":7369,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[153],"tags":[841],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7366"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/comments?post=7366"}],"version-history":[{"count":18,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7366\/revisions"}],"predecessor-version":[{"id":13479,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7366\/revisions\/13479"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media\/7369"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media?parent=7366"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/categories?post=7366"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/tags?post=7366"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}