Nidhi Company Formation
Nidhi Company is a company registered under Companies Act and notified as a Nidhi Company by Central Government under Section 406 of the Companies Act, 2013. It is a non-banking finance company doing the business of lending and borrowing with its members or shareholders.
Nidhi in the Indian context / language means “TREASURE”. However, in the Indian financial sector it refers to anymutual benefit society notified by the Central / Union Government as a Nidhi Company. They are created mainly for cultivating the habit of thrift and savings amongst its members.
Nidhi is a company formed with the exclusive object of cultivating the habit of thrift, savings and functioning for the mutual benefit of members by receiving deposits only from individuals enrolled as members and by lending only to individuals, also enrolled as members, and which functions as per Notification and Guidelines prescribed by the DCA. The word Nidhi shall not form part of the name of any company, firm or individual engaged in borrowing and lending money without incorporation by DCA and such contravention will attract penal action
First you have to register your company under the Companies Act, 2013. Then you have to get approval from Registrar of Chits for Chits company incorporation. For NBFC you have to get prior approval from RBI to commence business.
For Incorporation of a “NIDHI Company” first a public limited company need to be to incorporated with a minimum authorised capital of Rs. 5,00,000/- and 3 resident Indian directors. After incorporation an application is filled with central government to notify this company as “NIDHI Company” through its official gazettes. A public limited company must has at least 500 members before filing application to Central Government for obtaining “Nidhi Company” status.