To establish a Nidhi Company, the following criteria must be met:
- The company must have the suffix “Nidhi Limited” in its name
- The company must be a Public Company.
- Minor, Body Corporate and a Trust cannot be admitted as members to Nidhi.
- The minimum paid-up share capital must be Rs. 5 lakh.
- The company cannot issue preference shares, in the case where such shares have been issued by the company prior to the commencement of the Act, the same shall be redeemed.
- The primary objective of the company must be to inculcate the habit of savings in its members.
Post Incorporation Requirements of a Nidhi Company
Within one year of incorporation, a Nidhi company must satisfy the following conditions:
- The minimum number of members must be 200.
- The Net owned funds must be Rs. 10 lakhs. (Net owned funds is the aggregate of paid-up capital and free reserves reduced by the accumulated and intangible assets as appearing in the last balance sheet.)
- The net owned funds and the deposits shall be in a ratio not exceeding 1: 20 that is Net Owned Funds: Deposits = 1:20.
- Unencumbered term deposits should be not less than 10 % of the outstanding deposits as specified in Rule 14 of Nidhi Rules 2014.
Registration Process of a Nidhi Company
To apply for registration the Nidhi Company must have a minimum of 7 members and 3 Directors. On fulfilling this condition the Nidhi Company can follow the below-mentioned process:
- Apply for Director Identification Number (DIN) and Digital Signature Certificate.
- Go for Name Approval by using Reserve Unique Name (RUN) Service of MCA.
- Prepare the Articles of Association and Memorandum of association according to the objects of the company and all other documents.
- File for Incorporation Form SPICe+.
- Apply for PAN and TAN.
For obtaining incorporation the following documents will be required:
- Copy of PAN Card of Directors and Shareholders.
- Identity proof for Directors and Shareholders like Voters ID, Passport, Driving License.
- Address proof of Directors and Shareholders like Bank statements, utility bills.
- Passport size photographs.
- Registered office – property proof. a) If the property is owned then – Utility Bill + Ownership document + NOC. b) If the property is rented – Utility bill + Rent Agreement +NOC.
