Nidhi Company Registration

Nidhi Company Registration


Nidhi Company is a Company registered under the Companies Act, 2013 which has a sole objective of cultivating the habbit of thrift and saving amongst its members. Nidhi companies are allowed to take deposit from its members and lend to its members only. Therefore, the funds contributed for a Nidhi company are only from its members (shareholders) and used only by the shareholders of the Nidhi Company. Nidhi Company is a class of NBFCs and RBI is empowered to issue directions to them in matters relating to their deposit acceptance activities. However, in recognition of the fact that these Nidhis deal with their shareholder-members only, RBI has exempted the notified Nidhis from the core provisions of the RBI Act and other directions applicable to NBFCs. Therefore, Nidhi Company is an ideal entity to take deposit from and lend to a specific group of people.

Choose Nidhi Company because:

  • No External Involvement in Management
  • Helpful for Lower and Middle Classes
  • Low Rates of Interest
  • Secured Investments
  • Minimum Documentation and Formalities

Advantages of Nidhi Company Registration

  • No Minimum Share Capital Requirement
  • Easy Transfer of Ownership
  • Tax Benefits
  • No need to use “Nidhi” or “Limited” title
  • No Stamp Duty
  • Clear Objectives for easy donations and loans
  • Easy to Manage
  • Exemptions and Privileges under Companies Act, 2013
  • Relaxation in Compliances


  • Ownership documents or a rent/lease agreement has to be provided as a proof of address of the registered place of business
  • A No Objection Certificate(NOC) duly signed by the landlord or the owner of the place where the business is registered
  • Identity proofs
  • Address proofs of the members of the company
  • Photographs of the members of the company
  • Digital Signature Certificate(DSC) of the company
  • Copies of PAN cards of the members
  • Director Identification Numbers(DIN) of all the directors
  • Certified Copy of the updated Memorandum of Association(MoA)of the company
  • Certified copy of the updated Articles of Association(AoA) of the company

Minimum Requirements for Incorporation

Before Incorporation

  • Minimum 7 shareholders
  • Minimum 3 Directors
  • Minimum Capital of Rs. 10 lacs
  • DIN for all directors

After Incorporation

  • Minimum number of 200 Shareholders
  • Net owned Fund shall not be less than Rs. 10 Lacs
  • Unencumbered deposits of not less than 10% of the outstanding deposits
  • Net owned funds to deposits ratio should be more than 1:20

Concerns Related to Nidhi Company

  • Highly dependent on the integrity, honesty and loyalty of workers and Members.
  • Lacklustre sales promotion.
  • It caters to only the needs of small and medium-income groups.
  • Nidhi Companies are usually managed by amateurs and professional managers cannot be hired due to lack of funds.
  • People may be afraid to deposit funds because Nidhi Companies don’t require a license from the RBI.

Factors to Consider in Nidhi Company Name Selection

The name of your Nidhi Company is very important. Your Nidhi Company’s

name is the first impression to your buyers, suppliers and stakeholders. It should therefore be attractive, relevant and suggestive. There are several factors that you should keep in mind while choosing a name for your


Short & Simple

  • The name should be concise and not be too long. People should be able to recall and pronounce your company’s name easily the first time they hear or read it.


  • The name of your Nidhi Company should be relevant to your business. It should fit the company’s branding strategy. For example, Infosys refers to information systems or IT technologies.


  • Name of your Nidhi Company should not be exactly the same or identical to an existing LLP or company or trademark or for which a trademark has been applied for. You can go to to check if your company name matches any others. Ideally, you should avoid plural version e.g,“Snapdeals” or merely changing the letter Case or punctuation marks or spacing in an existing LLP, Company and Trademark name.


  • Nidhi Companies are not required to end their name with “Nidhi” or “Limited”.

Should not be illegal/offensive

  • The name of your LLP should not be against law. It should not be abusive or against the customs and beliefs of any religion and should not use words or phrases which are used as a slur and are offensive to a particular group of people. Further, names cannot include foul words or phrases

Should not violate any laws

  • Your Nidhi Company’s name should not be given under and violate the Emblems and Names (Prevention of Improper use) Act, 1950. Click here to check the names. (See the Schedule).

Should not use the words “British India”.


  • Professional fees :

  • 49999/-

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