FREQUENTLY ASKED QUESTIONS
1. What are the requirements for registration of a Nidhi Company?
– A Nidhi company is registered as a Public Limited Company. Hence, the requirements for incorporation of a Nidhi company covered a minimum of three Directors and Seven Shareholders. However, the MOA of a Nidhi company must state that the primary objective of the proposed company is to nurture and promote a habit of thriftiness and savings among its members, and accept deposits from or lend loans only to its members, for the mutual benefits of them.
2. Are the deposits with the company safe and secured?
– Yes, because Government of India/Ministry of Corporate Affairs/RBI has framed the laws/rules to ensure the security and safety of deposits and Nidhi companies must strictly abide by the rules and regulations framed by the Central Government.
3. How does the Nidhi Company use the fund/deposit procured by it?
-The Company uses the funds in lending to the Shareholder/members only as per the Nidhi company rules. Nidhi Company lending is in the shape of small loans for business and microfinance.
4. Who Can Invest in a Nidhi Company?
– Only shareholders/Members of the Nidhi Company who have a membership ID, can invest in the scheme. To be a member, you must be 18-years and above as per age proof and must be a citizen of India.
5. How can I become a Shareholder/Member of the Nidhi Company?
1. Business Restrictions:
Nidhi Companies are strictly prohibited from engaging in the following types of businesses:
Business of chit fund, hire purchase finance, leasing finance, insurance or acquisition of securities issued by anybody corporate. Nidhi Companies cannot carry on any business other than the business of borrowing or lending in its own name.
2. General Restrictions:
- Nidhi Companies cannot issue any shares, debentures or any other securities by any name or in any form whatsoever.
- Nidhi Companies cannot open current account with its members. Please note, there is a restriction on current account that means you can still open savings account with the members.
- Nidhi Companies cannot issue or cause to be issued any advertisement in any form for soliciting deposit.
- Nidhi Companies cannot pay any brokerage or incentive for mobilising deposits from members or for deployment of funds or for granting loans.
6. How many branches can a Nidhi Company open?
– A Nidhi Company can open 3 branches in its district only if it has earned profits after tax consistently during the preceding three financial years. For any additional branch, Nidhi will be first apply for approval from the Regional Director.
7. In which cities does LegalRaasta incorporate Nidhi Company?
– LegalRaasta provides Nidhi Company incorporation services across India in all cities. We have done Nidhi company registration in Mumbai, Delhi, Gurgaon, Noida, Bangalore, Chennai, Hyderabad, Ahmedabad, Kolkata, Surat, Pune, Jaipur, Lucknow, Kanpur, Nagpur and other Indian cities.
8. Why should I choose LegalRaasta for Nidhi Company registration?
– Legalraasta.com is one of the best online service portals to help register Nidhi Companies in India. We have 10 years of experience in application of Nidhi Company registration. LegalRaasta has 30+ regional offices in India and expand its network in India with 2000+ customers for Nidhi Company.