nidhi company

In this article, we will be discussing the procedure of the Incorporation of Nidhi Company. Nidhi Company is a non-banking financial business.

Company performs lending and borrowing of money jobs with its members themselves do all the work. This is done for the mutual benefits of all the members of the Nidhi company. It promotes saving and utilization of its funds within its members.

Nidhi Companies governed with the provisions of Section 406 of the Companies Act, 2013 (“CA, 2013”) and ruled by the Ministry of Corporative Affairs (hereinafter “MCA”). It is solely formed to create a habit of saving and benefits for each and every member of the Company.     

The functioning of Nidhi Company:

  • Funds are induced by the members in the form of contribution.
  • Company after aggregating all the contributions lent it to the members in need at a reasonable rate of interest.


Ministry of Corporate affairs notified Nidhi Rules, 2014, in order to carry out the purposes of Nidhi Companies.

The Rules as aforesaid provides that it is applicable on:

Every Company which is being declared as company under the Companies Act

Company working in accordance with the objectives of company ie., working for the mutual benefit of society.


  • There must be a minimum of 3 Directors;
  • There must be a minimum of 7 Members;
  • There is no Minimum Capital Requirement;
  • Nidhi company are not allowed to issue Preference Shares;
  • Objects must be limited to receiving funds only from its members and lending to its members for mutual benefits.

What to do after Registration of Nidhi Company

Raise minimum members to 200 within 12 months of registration of company. If any time during the business of Nidhi company the aggregate of total members falls below 200 then it will be considered as a default. However in that case the Company can request more time to get the total number. The request shall be raise in form NDH 2 and shall be filed to Regional Director, MCA

Raise net owned fund to minimum 10 lakhs ie., (Paid Up Share Capital + Free Reserves).

The procedure of registration of Nidhi Company:

  1. Obtain Digital Signature Certificate (DSC) of proposed Directors

This will be the first step of registration of company, the proposed directors are required to obtain the DSC. It is optional to have DIN prior to registration of Nidhi Company

  1. Application for Name Reservation using ‘RUN’ facility

After having DSC application for name availability in the RUN facility of the MCA portal is to be filed. It is to be noted that the word Nidhi Limited must be there at the end of the name of the proposed Company.

Every Company desirous to be registered as a “Nidhi” shall have the last words ‘Nidhi Limited’ as part of its name. Now, one doesn’t require the digital signature of the applicant for name availability.

  1. File Form SPICe 32

After the name approval, Form SPICe 32 shall be prepared and filed with the ministry with the following attachments.

  • MOA & AOA.
  • PAN Card of all subscribers;
  • Identity Proof & Address Proof of First Directors;
  • Address Proof of Registered premises
  • Latest Utility Bill
  • NOC of Owner of Registered Office, if premises is rented
  • Consent and Declaration of first Directors
  • Self-Declaration from First Directors and Subscribers in Nidhi Company.
  1. Certificate of registration of Nidhi Company 

After being satisfying with the submission of documents and information the Registrar of Company will issue a Certificate of Incorporation.


LetsComply is a full-service law firm and is the best platform for all your Legal, Finance and Taxation needs. Letscomply is one of the leading law firms in India and having a team comprises of Corporate Lawyers, Company Secretaries, Chartered Accountants, Cost Accountants, IP Attorneys, and Management Experts with rich experience in their respective filed. We believe in long-term alliances for mutual growth.

For more information, please contact us on or call us Mb. No.97178 22448 Ph. No.011-42662177/78/79.


Foreign Investment in IndiaSetting-up of Business in India |Virtual CFOVirtual General CouncilIncome Tax | GST Registration & Returns |Trademark registration | Company Registration | LLP Registration |NGO| Company Annual Compliances | Drafting & Vetting of Agreements |Opinion & Advisory on Different Issues| FSSAI Licenses| ESI & EPF | ISO certification |Shop & Establishment Registration |MSME Registration| SEIS/MEIS Services| DGFT| Legal Notices

Start typing and press Enter to search

Shopping Cart
Translate »

Thanks for contacting us