Nidhi Company Registration
Starting at INR 24,999 onwards
What is a Nidhi Company?
Nidhi is a hindi word meaning “treasure”, Nidhi companies were developed for encouraging the practice of savings among group of people and lending funds among them for mutual benefit. Companies having such objects are been legally recognized by Companies Act, 2013 under section 406 and are regulated by Ministry of Corporate Affairs. A Nidhi Registration needs a minimum of seven shareholders and three directors. This makes Nidhi Registration the most suitable kind of Company Registration for the objectives of lending and accepting deposits. Apart from the ease of registration and lower cost involved Nidhi Companies don’t require Reserve Bank of India License to begin with. Nidhi Companies by nature are incorporated as Public Companies under the Companies Act 2013. Nidhi Company can only deal with the objectives within the members and are not allowed to accept deposit or lend to anyone other than its members. Every Nidhi company is required to have at least two hundred members by the end of one year from its commencement.
Why Register a Nidhi Company?
No RBI License Required
A Nidhi Limited company is not required to get prior approval from Reserve Bank of India to start and conduct business activities. For other form of business organisations to carry on financial activities RBI approval is must but Nidhi Company is exempted from the same.
Lower Compliance
A Nidhi Limited has simple documentation, simple registration process, takes lesser time for Incorporation and Cost friendly to incorporate and maintain as. A Nidhi Company also has lower compliance’s as they are not required to register with Reserve Bank Of India.
Separate Legal Entity
A Nidhi Limited is a separate legal entity as distinct from its members, and is separate at law from its shareholders,directors, promoters etc. A Nidhi Limited Company has the capacity to own properties, incur debts and exercise a number of legal rights.
Limited Liability
Limited Liability protects the personal assets of founders, partners, directors or shareholders of the company in case of debt or insolvency. The liability of the members in respect of the company’s debts is limited only till their investment of capital in the company and not their personal assets.
Perpetual Succession
A Nidhi Limited Company exercise “Perpetual Succession”; which means that the company’s life is not determined by the longevity of its members, shareholders, promoters, directors, employees or anyone else. If a shareholder dies, or hypothetically, all the shareholders of Nidhi Limited Company dies or resigns , only their shares in the company will be transferred to new people.
Borrowing Capacity
A Nidhi Limited Company can avail better scope for borrowing funds. Banking institutions and Venture Capital Firms prefer to render financial assistance to a Nidhi Limited company rather than partnership firms, proprietary concerns or any other form of unregistered business. Even a newly formed Nidhi Limited Company can reap the benefits of easy borrowing.
Transferability of Shares
Shares of a Nidhi Limited Company are easily transferable by a shareholder to any other person. The Transfer process involves filing and signing a share transfer form and handing over the buyer of the shares along with share certificate.
Suing Capacity
A Nidhi Limited Company can file legal proceedings or a suit in a court of law exactly like an individual person. A Nidhi Limited Company being an independent legal entity can sue and also be sued in its own name.
What are the Requirements for a Nidhi Company Registration?
MEMBERS
For a Nidhi Company Registration the company must have at least seven members and there is no limit of maximum number of members Nidhi Company can have.
DIRECTORS
For a Nidhi Registration the company must have at least three directors and a minimum of one director should be an Indian. The maximum number of directors a Nidhi Company can register is 15.
CAPITAL REQUIREMENTS
To incorporate a Nidhi Company it must be incorporated with a minimum paid-up equity capital of Five Lakhs. Nidhi companies are not allowed to issue Preference Shares.
OBJECTIVES
A Nidhi Company can carry on the objectives of lending, accepting deposits and to promote the habit of savings only, and can only deal with such objectives with its members.
NAME
A Nidhi Company is required to have a suffix as Nidhi Limited in its name, since Nidhi Company is by nature a Public Limited Company registered under the Companies Act 2013.
REGISTERED OFFICE
The registered office of the Nidhi Company must be in India. It need not to be an owned space as even a rented space can be used as long as a NoC is obtained from the owner of the property.
What are the documents required for a Nidhi Registration?
Passport Sized Photo
Passport sized Photos of All Directors
Identity proof
Aadhar Card/Driving License/Voter ID Card/Passport
Address Proof
Latest Bank Statement/Utility Bill
Director Information
KYC Details Of Directors
Business Address Proof
Latest Bank Statement/Utility Bill
No Objection Certificate
NOC From the Property Owner
Rental Agreement
Rental Deed of the Business Premises
Property Documents
For self owned Property
How much Time does a Nidhi Registration takes?
Name Reservation Application
One Day
Acquire Digital Signature Certificate
One Day
Drafting Incorp Documents
Two – Three Days
Filing for Incorporation INC32
One Day
Receiving Certificate Of Incorporation
Fifteen Days
What are the Deliverables?
Certificate Of Incorporation
A Certificate of Incorporation is a legal document issued by the Ministry of Corporate Affairs and Government of India after the Company Registration. It serves as the proof of legal existence of Nidhi Limited Company.
Directors Identification Number
DIN is a unique Director Identification Number allotted by the Central Government to any individual intending to become a Director a company.It is an 8-digit unique identification number which has validity for lifetime.
Digital Signature
A Digital Signature (DSC) is an equivalent of a handwritten signature or stamped seal, but is way more secured and safe to use. You would receive a class 2 Digital Signature for all the Directors of the Company with a validity of 2 Years.
MOA/AOA
Memorandum of Association consists of the objectives of the organization. Articles of Association are reports that contains the purpose, obligations and responsibilities of its owners, directors, promoters or shareholders.
Company PAN
Registered businesses like Pvt Ltd Company needs to obtain a PAN Card in the name of the registered business. The PAN number needs to be quoted in every financial transaction of the business.
Company TAN
Tax Deduction Account Number is a 10 -digit alpha-numeric number issued by the Income-tax Department. TAN is to be obtained by all persons who are responsible for deducting tax at source (TDS) or who are required to collect tax at source (TCS).
How to select the Perfect Name for your Nidhi Registration?
The name of your company represents the ideologies, vision and working of the company and its founders. Hence choosing the right name for your company is highly essential as you don’t want to be stuck with a wrong or bad name that doesn’t go with the product/service and vision of your company. The name must be relevant, attractive and meaningful. However there are few other factors that should be kept in consideration while choosing the name for your business. Here are some crucial points to remember.
SHORT & SIMPLE
Your Company name should be short simple and quick to remember. It should also be easy to pronounce. You don’t want to have a name which is misspelt every time someone looks for it.
UNIQUE
The chosen name mustn’t be the same or identical to an already existing company or a trademark in any manner. Names identical to already existing companies are usually rejected by the MCA during Company Registration process.
MEANINGFUL
Your Company name should be short simple and quick to remember. It should also be easy to pronounce. You don’t want to have a name which is misspelt every time someone looks for it.
NO ILLEGAL/OFFENSIVE NAMES
The name of the company should be as per the law. It can’t be abusive, unethical, restricted (click here to see) or against any customs, beliefs, religion, ethnicity or country.
ADD BUSINESS TYPE
Adding the type of business at the end of the desired company name helps people to figure out the products/services of your company and establishes a brand image in the relevant domain.
WITH SUFFIX
The name of the company must end with the suffix “Nidhi Limited” in a case of a Nidhi company, since its by nature a Public Limited Company registered under Companies Act 2013.
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