Nidhi Company
What is Nidhi Company ?
Nidhi company is a nonbanking financial company formed to borrow and lend money to the members and includes saving habits among the members as it works on the principle of mutual benefits. This company operates in the southern part of the country typically. It is not required to receive a license from the Reserve Bank of India to form this company. It is registered as a public company and must have Nidhi limited as the last words of the name.
The main business of this company is to facilitate lending money between the core members of the company, and this way, members are encouraged to save money and invest the same in the company. The company will use the deposits for the members to provide loans or to acquire government-issued stocks, bonds, and debentures insecurities. RBI monitors all the financial dealings, which are regulated by the ministry of corporate affairs. You can go for Nidhi company registration online when you choose us.
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The checklist for a Nidhi company
- At least 7 members are compulsory to form the Nidhi company. Out of these, 3 must be designated as directors, and it must acquire 200 members within one year of commencement.
- The company must have a minimum equity share capital of INR 5,00,000 to register as a Nidhi company. The entire amount needs to be paid up. But the net owned fund should be increased from 10,00,000 within one year of registration.
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Documents required for Nidhi company registration
- self-attested copy of pan card
- Self-attested copy of aadhar card, driver’s license, voter ID, and passport.
- Self-attested copy of bank statement, mobile bill, electricity bill, and telephone bill.
- Passport size photograph
- Specimen signature certificate.
Procedure for Nidhi Company registration
- The company needs to reserve its name.
- You need to submit the DSC and DIN numbers.
- Documents should be approved by the authority. Experts will help you at every stage of the documentation process.
Benefits of Nidhi company
Cheaper to borrow
As a member, you can borrow money at a minimum rate relative to the other rate at other banks. It can be a significant advantage when you are in need, as different people in the mutual benefit society are likely to need funds at different times.
Encourages savings
The company encourages savings among all the members and also enables a thrifty lifestyle. After all, Nidhi company is a mutual benefit society where the members can borrow or lend money and accept financial health among them.
Minimum complications
Borrowing and lending out to known persons where the procedure is fixed are much less challenging as compared to dealing with a bank or an informal setting. This company allows the members to unlock the potential of the money and gain from the lower interest rate when they require cash themselves.
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