Nidhi finance companies are a dime a dozen in India. Do you know how they work? What their objectives are? Here, we will explore all you need to know about it. Nidhi companies are credit cooperatives that provide small loans to members without taking any collateral. They use a savings-linked deposit system where members contribute to a common pool of funds from which loans are given out. Nidhi companies usually have two different kinds of products: short-term and long-term loans. Short-term loans are generally for smaller amounts and have a tenure of up to one year, while long-term loans can go up to five years.
Why Nidhi Limited Company Important for Business
Nidhi limited companies play an important role in financial business by providing loans to small businesses and entrepreneurs. They are able to offer these loans at a lower interest rate than banks and other financial institutions, which makes them an attractive option for business owners.
In addition, Nidhi company can help business owners access capital that they may not be able to obtain from traditional sources. This can be especially helpful for start-ups and businesses that are expanding. By providing financing to these businesses, Nidhi finance companies can help them grow and create jobs.
Finally, Nidhi finance companies can provide a much-needed source of capital for businesses during economic downturns. When banks tighten their lending standards, it can be difficult for businesses to obtain loans. However, Nidhi finance companies are often willing to lend money to businesses even during tough economic times. This flexibility makes them an important source of funding for many businesses.
How To Register Nidhi Limited Company
Nidhi Company are regulated by the Ministry of Corporate Affairs (MCA) and are required to follow certain guidelines. In order to register a Nidhi company, the promoters must first submit an application to the MCA along with the necessary documents.
The MCA will then scrutinize the application and if everything is in order, they will issue a Certificate of Incorporation Nidhi Company. Once the company is registered, it must comply with the provisions of the Companies Act and the Rules framed thereunder.
The Nidhi company must have a minimum paid-up capital of Rs 5 lakhs and a minimum net worth of Rs 10 lakhs. It must also have at least 200 members. The board of directors must have a minimum of 3 members and a maximum of 15 members.
The company must have its own seal and common seal. The common seal shall be used only by the authorized signatories on behalf of the company. The company must maintain proper books of accounts and get them audited by a qualified chartered accountant every year.
The Nidhi Company can accept deposits from its members only and no other person or entity. The deposits accepted by the Nidhi Company shall be in compliance with Sections 73 to 76 of Companies Act, 2013 read with Rule 8 of Companies (Acceptance of Deposits) Rules, 2014.
Requirement of Nidhi Company Registration
A Nidhi company is a non-banking finance company (NBFC) that is registered under the Companies Act, 2013. Nidhi companies are also known as permanent NBFCs or deposit taking NBFCs.
Nidhi companies are set up with the primary objective of collecting funds from their members and deploying them for the welfare of their members in the form of loans and advances. Thus, a Nidhi company must have a minimum membership of 200 people. Further, at least 10% of its net owned fund should be invested in government securities or other approved securities.
In order to register a nidhi company kolkata, the following documents must be submitted to the Registrar of Companies:
1. A duly completed application form along with the prescribed fees
2. The memorandum & articles of association
3. A list of directors and shareholders of the company
4. An affidavit from each director regarding his/her eligibility to hold office
5. A declaration from each director that he/she is not disqualified from holding office under any law
6. Such other documents as may be prescribed by the Registrar.
Best Online Company Registration & Business Accounting Services 