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Explain all about Nidhi Company & How to Start?

A Nidhi Company is a type of non-banking financial institution (NBFC) that is prevalent in India. A Nidhi company is a type of company that is registered under the Companies Act and notified as a Nidhi company by the Central Government.

It is a non-banking finance company that does the business of lending and borrowing money with its members or shareholders. The main objective of a Nidhi company is to cultivate the habit of thrift and savings among its members and to provide them with financial assistance for their mutual benefit.

Nidhi Companies are regulated by the Ministry of Corporate Affairs (MCA). However, they are exempt from some of the regulations that apply to other NBFCs, such as the requirement to have a minimum net owned fund (NOF).

This exemption is granted because Nidhi Companies only deal with their shareholder-members’ money. Nidhi Companies primarily function as a mutual benefit society.

They accept deposits from their members and provide them with loans at reasonable interest rates. The deposits collected are utilized for granting loans and advances to members, who are mainly individuals from the middle and lower-income groups.

To start a Nidhi company, you need to follow some simple steps:

The first step in starting a Nidhi Company is to form a group of at least seven individuals who share a common goal of mutual benefit. These individuals will become the initial members of the company and will be responsible for its formation.

A minimum capital of Rs. 5 lakhs is required to start a Nidhi Company. This capital serves as a security for member deposits and loans. Once the group is formed, the next step is to register the company with the Ministry of Corporate Affairs (MCA) in India.

This requires the preparation of a memorandum of association (MOA) and articles of association (AOA), which outline the objectives and rules of the company. Select a unique name for your Nidhi Company, ensuring it complies with naming regulations.

The name must include “Nidhi Limited” at the end. Ensure that you have at least 200 members within one year of incorporation and maintain a net-owned fund of at least Rs. 10 lakhs.

Comply with the rules and regulations of the Nidhi company, such as filing annual returns, maintaining books of accounts, conducting board meetings and general meetings, etc.

As your Nidhi Company grows, consider expanding your services and branch network to reach more members. Staying updated on regulatory changes is vital for continued success. Nidhi Companies are a popular form of non-banking financial institution in India.

They offer several benefits to their members, such as attractive interest rates on deposits, easy access to loans, safe and secure investments, and a sense of community.


As we all know, launching a Nidhi Company demands careful adherence to regulatory guidelines. A commitment to financial integrity and community development is essential.

By understanding and following the necessary procedures, entrepreneurs can successfully establish and operate a Nidhi Company.

Here, our role starts in and our team will guide you at every step. If anyone wants to start or looking for businesses seeking Company registration services in India, including Private Limited Company registration services in India, Proprietorship Registration Services In India, or any other government-related services or registration process details our team of experts will guide you at every step. We are one of the best service providers in the registration of companies, taxation, loans, Income tax, GST services, returns, etc, and many more under one roof.

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