This article covers the Nidhi Company Registration Process in Detail. But let us first understand what is a Nidhi Company.
A Nidhi company is basically a type non-banking Indian Finance company and it is also recognized under section 406 of the Companies Act 2013. They basically borrow and lead money to their members. Nidhi Companies in India are made for developing the propensity for thrift and investment funds among its individuals. Nidhi organizations are permitted to get from their individuals and loan to their individuals. Accordingly, the assets contributed to a Nidhi company registration are just from its individuals (shareholders). Nidhi organizations are minute when contrasted with the saving money division and are for the most part used to develop investment funds among a gathering of individuals. In this article, we, for the most part, take a gander at the subtleties of enrollment of a Nidhi Company in India.
Nidhi Company Overview
Nidhi Companies are enrolled in Limited Companies required in taking stores and loaning to their individuals. The exercises of a Nidhi Company fall under the domain of the Reserve Bank of India, as it is a Non-Banking Finance Company (NBFC). Be that as it may, as Nidhi Companies ONLY manage shareholder-individuals cash, RBI has exempted Nidhi Companies from the center arrangements of the RBI and different controls appropriate to an NBFC.
Restrictions on Nidhi Company in India
The accompanying is a portion of the confinements a Nidhi Company is liable to under Nidhi Rules, 2014. According to Rule 6 of Nidhi Rules, 2014, a Nidhi Company might not:
- bear on the matter of chit reserve, contract buy fund, renting money, protection or obtaining of securities issued by any one corporate;
- issue inclination shares, debentures, or whatever other obligation instruments by any name or in any frame at all;
- open any present record with its individuals;
- gain another company by buy of securities or control the synthesis of the Board of Directors of some other company in any way at all or go into any plan for the change of its administration, unless it has passed a unique determination in its general meeting and acquired the past endorsement of the Regional Director having locale over such Nidhi;
- bear on any business other than the matter of obtaining or loaning in its own name: Provided that Nidhis which have clung to every one of the arrangements of these principles may give locker offices on lease to its members subject to the rental salary from such offices not surpassing twenty for every penny of the gross pay of the Nidhi any time of time amid a budgetary year.
- acknowledge stores from or loan to any individual, other than its individuals;
- vow any of the benefits stopped by its individuals as security;
- take stores from or loan cash to anyone corporate;
- go into any association course of action in its getting or loaning exercises;
- issue or cause to be issued any promotion in any frame for requesting store: Provided that private dissemination of the subtle elements of settled store Schemes among the individuals from the Nidhi conveying the words “for private flow to individuals just” should not be thought to be a commercial for requesting stores.
- pay any business or motivation for activating stores from individuals or for an arrangement of assets or for allowing credits.
Nidhi Company Registration Process
To start a Nidhi Company the initial step of the Nidhi Company Registration process is to apply for a limited Company Registration, under the Companies Act, 2013. Subsequently, at least three Directors and seven shareholders will be required to begin the Limited Company fuse preparation. Amid the Nidhi company Registration process, a mind must be taken to guarantee that the question of the Limited Company specified in the Memorandum of Association is that of developing the propensity for thrift and reserve funds among its individuals, accepting stories from, and loans to, its individuals just, for their common advantage.
Nidhi Company Incorporation Requirements
Post Company Registration, within a time of one year from the beginning, the Nidhi Company must meet the greater part of the accompanying criteria:
not have under two hundred individuals (shareholders);
Have Net Owned Funds (NOF) of ten lakh rupees or more;
Have unhampered term stores of at least ten for every penny of the extraordinary store; and
Have a proportion of Net Owned Funds to stores of not more than 1:20.
“Net Owned Funds” implies the total of paid-up value share capital and freeholds as decreased by amassed misfortunes and impalpable resources showing up in the last evaluated accounting report.
On the off chance that the Nidhi Company fulfills the above conditions required for working with a Nidhi Company, the company should inside ninety days from the end of the main budgetary year after its fuse and where relevant, the second money related year, document an arrival of statutory compliances in Form NDH-1 properly confirmed by a rehearsing CA/CS/CWA alongside the essential expenses.
On the off chance that toward the end one year from initiation the Nidhi Company is not ready to meet the above prerequisite, the Company may inside thirty days from the end of the primary money related year, apply to the Regional Director in Form NDH-2 for expansion of time.
On the off chance that even after the second financial year the Nidhi Company is not ready to meet the necessities for a Nidhi Company formation, then the Nidhi Company might not acknowledge any further stores from the initiation of the second budgetary year till it consents to the arrangements for working as a Nidhi Company and be at risk for reformatory results.
Reports Required for Nidhi Company Registration process
For Directors and Shareholders
- Character (Identity) Proof (Election ID/Aadhar Card/Passport/Driving License)
- Travel permit/Passport Photo
- Address Proof (Bank Statement/Mobile Bill/Telephone)
For Registered Company Office
- Rent Agreement (Notarised: For leased property)
- Property (Director/Relative) – Registry Proof/House Tax Receipts (Notarised)
- Most recent Electricity Bill
- NOC from the proprietor on the name of any executive (Notarised)
Apply for Nidhi Company Registration with Company Registration Online by filling a simple form.
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