Nidhi Company Registration Process
According to Section 406 of Companies Act 2013 “Nidhi” means a company which has been incorporated as a Nidhi with the object of cultivating the habit of thrift and savings amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit, and which complies with such rules as are prescribed by the Central Government for regulation of such class of companies. Look here for the benefits of Nidhi company registration.
Nidhi companies are governed by the Provisions of Companies Act 2013. Hence such type of Companies are registered with Ministry of Corporate Affairs (MCA). A Nidhi to be incorporated under the Act shall be a public company and shall have a minimum paid up equity share capital of five lakh rupees. Further all the Director are mandatorily required to be members of Nidhi.
Nidhi Company can be registered online. It’s a completely hassle free online process and Muds is a brand in Nidhi Company Registration. Following is the detailed Nidhi Companies Registration Process:-
1. Obtaining Director Identification Number (DIN):
The proposed Directors who may also be the Promoters/Applicants of Nidhi Company have to apply for DIN in the Prescribed E-Form . It may be noted that Such E-form has to be signed by the proposed Directors by Digital signature only. Hence, one needs to first get the Digital signature
2. Name approval:
The Applicants are required to get a suitable name approved from MCA . Such proposed Names should suitable and suggestive of company businessas per the name availability guidelines issued by MCA. Every Company incorporated as a “Nidhi” shall have the last words ‘Nidhi Limited’ as part of its name. It may be noted that From 26 th January 2018 the MCA has simplified the Name availability process. Now to apply for Name of a Nidhi Company we do not require the DSC of applicants
3. Submission of Incorporation Documents:
Once the name is approved, by MCA the Applicants need to file various documents for incorporation of Nidhi Company with MCA through prescribed E-Forms. Such E-forms are filed online with MCA through (www.mca.gov.in)
4. Approval and Certificate of incorporation :
Once all the documents and Forms have been filed and Registration fee and stamp duty paid ,It typically takes 15- 25 days to get the incorporation certificate of Nidhi Company. Incorporation certification is a proof that all the formalities regarding the incorporation have been complied with. The certificate of Incorporation contains the Corporate Identity Number (CIN) of such Company.
Checklist for Incorporation of Nidhi Company
Following is the detailed Check list for incorporation of a Nidhi Company
Following Documents of Members/Directors
- Copy of PAN Card
- Passport size photograph
- Copy of Aadhaar Card/ Voter identity card
Proof of Registered office
- Copy of Rent agreement of office premises executed on the name of Company.(If rented property)
- Copy of Electricity/ Water bill of registered office
- NOC from Landlord that he has no objection for using his premises as the registered office of Company.
Declarations and Affidavits from proposed 1 st Directors of Nidhi Company in the prescribed Format.
Form DIR-2 from all the proposed Directors
Memorandum of Association and Articles of Association
Note :- No Nidhi shall have any object in its Memorandum of Association other than the object of cultivating the habit of thrift and savings amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit.
Requirements for Nidhi Company Registration / Assets of Nidhi company Registration
It requires seven people to start the Nidhi Company in India. Further, the initial capital required for Nidhi Company registration is Rs.5 lakh. However, company needs to comply four important requirements:
- Net Owned fund to Deposit should not exceed 1:20.
- 200 Members should have been added by the company within one year.
- Rs.10 lakh capital should be raised by the end of first year.
- Company should keep at least 10% in the fixed deposit in any scheduled commercial bank.
Difference Between Chit Fund and Nidhi Company
|Chit Fund||Nidhi Company|
|Chit Fund Companies are regulated by the respective State Governments Laws.||Nidhi Companies are regulated by Ministry of Corporate Affairs, Government of India|
|Chit implies a transaction by which a person goes into an agreement with a specified no. of persons, that everyone should subscribe a certain entirety of money (or a certain amount of grain instead), by method for periodical installments over a definite period and that each such subscriber might, in his turn, as determined by part or by auction or by delicate or in such other manner as might be specified in the chit agreement, be entitled to the prize amount .||It is an NBFC doing the business of lending and borrowing with its members and shareholders. Further Nidhi companies are not required to obtain any license from RBI.|
|Chit Fund companies are usually formed as Partnership firms with unlimited Liability.||A Nidhi Company has to be incorporated as a limited Liability Company. pursuant to provisions of Companies Act 2013.|
Nidhi Company Registration Fees
There are various components of fee for Registration of a Nidhi Company. It may be noted that Nidhi Company Registration fee is paid online.
- Registration fee payable to Ministry of Corporate Affairs.
This fee depends on the authorized capital of the Company. Greater the Authorised Capital greater is the Registration fee. Beside this a fee of Rs 1000 is applicable on name approval and Rs 500 is applicable on DIN registration per Director.
- Stamp duty.
Stamp duty is payable on Memorandum of Association and Articles of Association. Since stamp duty is a state subject therefore the amount varies from state to state.