Registration

• 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 and having minimum three directors and seven members.
• No nidhi shall issue preference shares.
• 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.
• Every Company incorporated as a “Nidhi” shall have the last words ‘Nidhi Limited’ as part of its name.

Requirements within one year of Registration

• Two hundred members.
• Net Owned Funds of ten lakh rupees or more.
• Unencumbered term deposits of not less than ten per cent of the outstanding deposits.
• Ratio of Net Owned Funds to deposits of not more than 1:20.

Un-encumbered term deposits.—Every Nidhi shall invest and continue to keep invested, in unencumbered term deposits with a Scheduled commercial bank (other than a co-operative bank or a regional rural bank), or post office deposits in its own name an amount which shall not be less than ten per cent of the deposits outstanding at the close of business on the last working day of the second preceding month.

If the failure to comply with this rules, Nidhi shall not accept any further deposits from the commencement of the second financial year till it complies with the provisions contained in this rule, besides being liable for penal consequences as provided in the Act.

General restrictions or prohibitions

• No Nidhi shall carry on the business of chit fund, hire purchase finance, leasing finance, insurance or acquisition of securities issued by any body corporate.
• No Nidhi shall issue preference shares, debentures or any other debt instrument by any name or in any form whatsoever.
• No Nidhi shall open any current account with its members.
• No Nidhi shall acquire another company by purchase of securities or control the composition of the Board of Directors of any other company in any manner whatsoever or enter into any arrangement for the change of its management, unless it has passed a special resolution in its general meeting and also obtained the previous approval of the Regional Director having jurisdiction over such Nidhi.
• No Nidhi shall carry on any business other than the business of borrowing or lending in its own name. Provided that Nidhis which have adhered to all the provisions of these rules may provide locker facilities on rent to its members subject to the rental income from such facilities not exceeding twenty per cent of the gross income of the Nidhi at any point of time during a financial year.
• No Nidhi shall accept deposits from or lend to any person, other than its members.
• No Nidhi shall pledge any of the assets lodged by its members as security.
• No Nidhi shall take deposits from or lend money to any body corporate.
• No Nidhi shall enter into any partnership arrangement in its borrowing or lending activities.
• No Nidhi shall issue or cause to be issued any advertisement in any form for soliciting deposit. Provided that private circulation of the details of fixed deposit Schemes among the members of the Nidhi carrying the words “for private circulation to members only” shall not be considered to be an advertisement for soliciting deposits.
• pay any brokerage or incentive for mobilising deposits from members or for deployment of funds or for granting loans.

Membership

• Every Nidhi shall issue equity shares of the nominal value of not less than ten rupees each.
• No service charge shall be levied for issue of shares.
• Every Nidhi shall allot to each deposit holder at least a minimum of ten equity shares or shares equivalent to one hundred rupees.
• A Nidhi shall not admit a body corporate or trust as a member.
• every Nidhi shall ensure that its membership is not reduced to less than two hundred members at any time.
• A minor shall not be admitted as a member of Nidhi. Provided that deposits may be accepted in the name of a minor, if they are made by the natural or legal guardian who is a member of Nidhi.

Branches Opening

• A Nidhi may open branches, only if it has earned net profits after tax continuously during the preceding three financial years.
• Nidhi may open up to three branches within the district.
• If a Nidhi proposes to open more than three branches within the district or any branch outside the district, it shall obtain the prior permission of the Regional Director and an intimation is to be given to the Registrar about opening of every branch within thirty days of such opening.
• No Nidhi shall open branches or collection centres or offices or deposit centres, or by whatever name called outside the State where its registered office is situated.
• No Nidhi shall open branches or collection centres or offices or deposit centres, or by whatever name called unless financial statement and annual return (up to date) are filed with the Registrar.

Branches Closing

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• A Nidhi shall not close any branch unless publishes an advertisement in a newspaper in vernacular language in the place where it carries on business at least thirty days prior to such closure, informing the public about such closure.
• Fixes a copy of such advertisement or a notice informing such closure of the branch on the notice board of Nidhi for a period of at least thirty days from the date on which advertisement was published.
• Gives an intimation to the Registrar within thirty days of such closure.

Deposits Conditions

• A Nidhi shall not accept deposits exceeding twenty times of its Net Owned Funds (NOF) as per its last audited financial statements.
• The fixed deposits shall be accepted for a minimum period of six months and a maximum period of sixty months.
• Recurring deposits shall be accepted for a minimum period of twelve months and a maximum period of sixty months.
• The maximum balance in a savings deposit account at any given time qualifying for interest shall not exceed one lakh rupees at any point of time.

Deposits Interest Rate

• Rate of interest on saving deposit account shall not exceed two per cent above the rate of interest payable on savings bank account by nationalised banks. (Current Rate of SBI is 3.5% + 2% Extra for Nidhi = Total 5.5% interest per annum).
• A Nidhi may offer interest on fixed and recurring deposits at a rate not exceeding the maximum rate of interest prescribed by the Reserve Bank of India which the Non-Banking Financial Companies can pay on their public deposits. (Current Rate of RBI is 12.5% per annum).

Loans Limit

• A Nidhi shall provide loans only to its members.
• Two lakh rupees, where the total amount of deposits of such Nidhi from its members is less than two crore rupees.
• Seven lakh fifty thousand rupees, where the total amount of deposits of such Nidhi from itsmembers is more than two crore rupees but less than twenty crore rupees.
• Twelve lakh rupees, where the total amount of deposits of such Nidhi from its members is more than twenty crore rupees but less than fifty crore rupees.
• Fifteen lakh rupees, where the total amount of deposits of such Nidhi from its members is more than fifty crore rupees.

Provided that where a Nidhi has not made profits continuously in the three preceding financial years, it shall not make any fresh loans exceeding fifty per cent of the maximum amounts of loans.

Provided further that a member shall not be eligible for any further loan if he has borrowed any earlier loan from the Nidhi and has defaulted in repayment of such loan.

Loans Conditions

• A Nidhi shall give loans to its members against gold, silver and jewellery. Provided that the re-payment period of such loan shall not exceed one year.
• A Nidhi shall give loans to its members against immovable property. Provided that the total loans against immovable property shall not exceed fifty per cent of the overall loan outstanding of the value of property offered as security and the period of repayment of such loan shall not exceed seven years.
• A Nidhi shall give loans to its members against fixed deposit receipts, National Savings Certificates, other Government Securities and insurance policies. Provided that such securities duly discharged shall be pledged with Nidhi and the maturity date of such securities shall not fall beyond the loan period or one year whichever is earlier. Provided further that in the case of loan against fixed deposits, the period of loan shall not exceed the unexpired period of the fixed deposits.

Loans Interest Rate

• The rate of interest to be charged on any loan given by a Nidhi shall not exceed seven and half per cent above the highest rate of interest offered on deposits by Nidhi and shall be calculated on reducing balance method. (Maximum Interest can be charged 12.5% + 7.5% = 20%).

Directors

• The Director shall be a member of Nidhi.
• The Director of a Nidhi shall hold office for a term up to ten consecutive years on the Board of Nidhi.
• The Director shall be eligible for re-appointment only after the expiration of two years of ceasing to be a Director.

Name Approval Application

Name applications under RUN will be processed by Central Registration Centre (CRC). The name approval is subject to comprehensive check by the Central Registration (CRC) and thereafter approval or rejection shall be communicated by e-mail to the applicant. The name approved under RUN Process for new Company registration is valid for a period of 20 days from the date of approval. In case of change of name of an existing company, the name shall be valid for 60 days from the date of approval. RUN Company Name Application Fee is Rs.1000.00. This fee is additional to the regular fee to be paid through SPICE Application for Company Registration. RUN Company Name Application mandatory process. Alternatively, the applicant can apply Company Name through the integrated SPICE Application for Company Registration. In that case, we can submit ONLY ONE name for seeing approval. However, there are TWO changes of re-submissions for SPICE Application. So, effectively the applicant can submit FOUR NAMES (1-Original Submission + 1 Re-submissions) for approval without any extra cost.

DSC (Digital Signature)

A digital signature is electronic signature, which is in the form of codes. It is used for signing the electronic forms, filed with ROC for incorporation of Company. Digital Signature cannot be used in physical documents. The Company Registration in procedure is completely online and hence it requires digital signature to incorporate a company. It is mandatory for subscribers and directors to have a valid DSC (Class II or III). You can get a DSC from us in just one day. If you already have a digital signature, then you can use the same but check for its validity since agencies issues DSC’s with either one or two-year validity.

Apply For DIN (Director Identification Number)

Director Identification Number is a unique number which is given to existing directors of Incorporated Companies.
Rule 2(d) of Companies (Appointment and Qualification of directors)Rule 2014 defines Director Identification Number as an identification number which is allotted by the Central Government to any individual, intending to be appointed as Director or to any existing director of a company for the purposes of identifying as a director of a company.
The following points are the purpose of using DIN

• It's a unique identification number.
• The entire database of the director can be found using DIN
• The name of the director, address and PAN number can be found.
• The past companies in which he had worked and present company in which he is working can be found.
• Once obtained DIN number, the director can use the same for life irrespective of the company he works in. A change in the company doesn’t change the Director Identification Number.

FORM SPICE (INC-32) MOA (INC-33), AOA (INC-34), AGILE

Form INC-32 must be accompanied by supporting documents including details of Directors & subscribers, affidavits, declarations, identity proof, address proof, MoA and AoA etc. Once the eForm is filed, its processed by the MCA’s Central Processing Centre.
If found complete company would be registered and CIN would be allocated. Also DINs gets issued to the proposed Directors who do not have a valid DIN. Maximum three Directors are allowed for using this integrated form for filing application of allotment of DIN while incorporating a company. Once all the 4 forms ready with the applicant, upload all three documents as Linked form on MCA website and make the payment of the same.

• In respect of non-individual first subscribers who are based outside India, pdf attachments of apostilled MOA and AOA shall be attached with SPICe (INC-32).
• SPICe AoA (INC-34) has facility for adding, modifying, and deleting Articles. Thus if additional article is required, we may add the same
• DSC is mandatory for all subscribers and witnesses in eMoA (INC-33) and eAoA (INC-34). eMoA and eAoA shall be used only where the maximum number of subscribers do not exceed 7. In case the numbers of subscribers are more than 7, MoA and AoA shall be attached manually to SPICe and DSC is not mandatory in such cases.
• Two resubmissions are only permitted in the e-form
• SPICe eMoA and eAoA have to be uploaded as ‘Linked Forms’ to SPICe (INC-32).
• The Ministry of Corporate Affairs (MCA) has notified an E-form known as AGILE – Application for Registration of the Goods and Services Tax Identification Number (GSTIN), Employees’ State Insurance Corporation (ESIC) registration and Employees Provident Fund Organization (EPFO) registration.
• GSTIN Application via E-form AGILE and Mandatory to file INC-35 while submitting SPICe form.
• It is mandatory to apply for PAN and TAN for the proposed company along with SPICe form.

Certificate Of Incorporation

Incorporation certificate shall be generating with CIN, PAN & TAN. Company has to pay the Stamp Duty irrespective of the capital because Stamp Duty is state matter. Companies Act, has given exemptions for the ROC fees not for the stamp duty with authorized Capital of Rs. 10 Lakh or below.

PAN and TAN Application

Once you receive the certificate of Incorporation apply for PAN and TAN as they would be required for opening a bank account. You can also apply for the same along with INC-32 at the time of incorporation.

Commencement of Business (INC-20A)

eForm INC-20A (Declaration for commencement of business) is required to be filed pursuant to Pursuant to Section 10A(1)(a) of the Companies Act, 2013 and Rule 23A of the Companies (Incorporation) Rules, 2014.
As per new section inserted after section 10 of the companies act 2013, section 10A says a company incorporated, having share capital shall not commence its business or exercise any borrowing powers unless a declaration is filed by the directors within 180 days from date of incorporation of company. the Registrar of Companies that ‘every subscriber to the MOA has paid the value of the shares agreed to be taken by him on the date of making of such declaration”