Checklist of Documents Required for Nidhi Company Registration

Before we list out the documents required for Nidhi Company Registration in India let us first understand what is a Nidhi Company Registration and why is it beneficial to start a Nidhi Company

Introduction to Nidhi Company

Nidhi means a company which has been incorporated with the object of developing the habit of thrift and reserve funds amongst its members and also receiving deposits and lending to its members only for their mutual benefit.

Benefits of Nidhi Company Registration

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

Nidhi Company Registration Checklist

Now that you know the basic features of Nidhi Company let us discuss in detail the documents required for Nidhi Company Registration, minimum requirements to be fulfilled at the time of registration, and the checklist to register a Nidhi Company.

Minimum Requirements Before Incorporation of Nidhi Company:

  • Minimum 7 shareholders
  • Minimum 3 Directors
  • Minimum Capital of Rs. 10 Lacs
  • DIN for all Directors
  • Valid documents required for Nidhi Company Registration

Nidhi Company Registration Procedure

  1. Obtaining DSC for All the members and Directors

DSC or Digital Signature is a physical signature in an electronic format. Digital Signatures are used in India for online transactions such as Filing Annual Return, Company or LLP Incorporation, Income Tax E-Filing, E-Tenders, etc. There are 3 types of Digital Signatures, Class I, Class II, and Class III Digital Signatures. Class I Digital Signature is used for securing email communications. Class II digital signature is utilized for company registrations, IT Return E-filing, Obtaining DIN, DPIN, etc. Class III digital signature registration is used for E-tendering and participating in E-Auctions. One of the most important documents required for Nidhi Company Incorporation.

2. Obtaining DIN for All the Directors

DIN is a unique Director identification number allotted by the Central Government to any person intending to be a Director or an existing director of a company.  It is an 8-digit unique identification number which has lifetime validity. Through DIN, details of the directors are maintained in a database.DIN is specific to a person, which means even if he is a director in 2 or more companies, he has to obtain only 1 DIN. And if he leaves a company and joins some other, the same DIN would work in the other company as well.

3. Application for Approval of Names

The name you fill must be the exact name, as you want it to appear in the Certificate of Incorporation. We suggest filling in 2 alternate names in case of rejection by the Ministry of Corporate Affairs. This is just in case of rejection, not something that usually happens, still better to be safe than sorry. The 2 alternate names will be used in their order of preference. You must think carefully before adopting a name because all and sundry names cannot be allowed. There is a list of undesirable names that cannot be used. A proposed name will be considered to be undesirable if it is identical with or it too closely resembles the following:

  • Names of existing companies and LLPs or names approved by the Registrar of Companies and LLP
  • A registered trademark or a trademark for which registration has been applied for and used or owned by others.
  • Names are given under and violating the Emblems and Names (Prevention of Improper use) Act, 1950.
  • Foul words or phrases.
  • Words or phrases which are used as a slur and are offensive to a particular group of people.
  • Names which have the words “British India”

4.  Signing all the Documents Required for Nidhi Company Registration

5. Application for Incorporation of Nidhi Company with ROC

6. Approval by ROC, after verifying all the required documents and information.

To be able to successfully register a Nidhi company one should have all the Documents required for the Nidhi Company Registration process as stated below:

Documents required for Nidhi Company Registration

  • Copy of Director’s Pan Card
  • Passport size photograph of Directors
  • Copy of Aadhar Card/Voter identity card of Directors
  • Copy of Rent agreement(If rented property)
  • Electricity/Water bill (Business Place)
  • Copy of Property papers(If owned property)
  • Landlord NOC ( Format will be provided)

Post-Compliance of Nidhi Company

Once you have successfully registered the Nidhi Company make sure that you comply with these requirements to avoid cancellation of your registration or penalties. The following are the post-compliance in short.

  • 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

For more information regarding the Nidhi company registration process and documents, you can visit Company registration online

Related Article-

2020-10-07T08:06:20+00:00Nidhi Company|
Go to Top