• Sole objective of cultivating the habit of thrift and savings amongst its members
  • Allowed to take deposit from its members and lend to its members only.
  • The funds contributed for a Nidhi company are only from its members (shareholders) and used only among the shareholders of the Nidhi Company.


  1. Minimum 7 Members;
  2. Minimum 3 Directors;
  3. Minimum Capital Required: 10,00,000/-
  4. It is registered as Public Company.
  5. Name of Company: It shall have the words ‘Nidhi Limited’ as part of its name;
  6. Object of the company : receiving deposits from and lending to its members only for their mutual benefits.
  7. All Directors shall be members of Nidhi.


  • Minimum 200 Members
  • Net Owned Funds of Rs.20 Lakhs or more
  • Unencumbered Term Deposits – minimum 10% of Outstanding Deposits
  • Ratio of Net Owned Funds to Deposits: 1:20


  • Form NDH-1- Return of Statutory Compliances. Due date to file this form is within 90 days from the close of first F.Y. (29th June)
  • Form NDH-2-Extention of time for Number of Members and Net owned Fund Due date to file this form is within 30 days from the close of First F.Y. (29th April)
  • Form NDH-3– Half-yearly Return. Due date to file this form is within 30 days from the conclusion of each half year. (29th April and 29th October)
  • Form AOC-4: Form for filing of Financial Statements of the company. Due date to file this form is within 30 days from the date of AGM. (29th October)
  • Form MGT-7: Form for filing of Annual Returns. Due date to file this form is within 30 days from the date of AGM.


Basic documents required for registration

For Company:

  1. Registered address proof -Electricity Bill/ Telephone Bill/ Mobile Bill/ Gas Bill (any one)
  2. No Objection Certificate for use of office address

For Directors and subscribers:

  • Self-attested PAN Card and Aadhar Card Copy
  • Self-attested Residence Proof: Electricity Bill/Bank Statement/Mobile Bill  (Any one)
  • Passport size photographs

Basic Information required for registration

For Company:

  • Proposed Name of Company 
  • Nature of business
  • Initial Capital
  • Contact No. and Email Id

For Directors and subscribers:

  • Name of Director/ Shareholder
  • Mobile No.
  • Email Id
  • Place of Birth
  • Educational Qualification
  • Current Occupation

Restrictions on NIDHI Companies:

  1. Carry on Business of Chit Fund, Hire Purchase Finance, Leasing Finance, insurance or acquisition of securities issued by any body corporate
  2. Issue Preference Shares, Debentures or any other debt instrument
  3. Open Current Account with its members
  4. Pledge any of assets lodged by its own members as security
  5. Lend to or accept funds from third party
  6. Lend or deposit money to any corporate body
  7. Enter into partnership in its activities of lending and borrowing
  8. Pay any brokerage or incentives for mobilizing deposits from members
  9. Acquire another company by purchase of securities OR Control the composition of the Board of Directors of any other company unless it has passed a special resolution in its general meeting and also obtained the previous approval of the Regional Director.
  10. Shall not admit a body corporate, trust or minor as a member.

Nidhi Company: Deposit rules

  • A nidhi company can Open Fixed Deposits, Recurring Deposits and Saving Deposit Accounts of Members
  • There shall be a Lock in period of 3 months (cannot repay deposit within 3 months of acceptance)
  • Deposits can be accepted up to 20 times of the Net Owned Fund.
  • Maximum Balance in a savings account qualifying interest shall not exceed 1 Lac at any point of time and ROI shall not exceed 2% above ROI payable on savings account by Nationalised Banks.
Type of Deposit Duration
Fixed Deposit Minimum period-6 Months Maximum period-60 Months
Recurring Deposit Minimum period-12 Months Maximum period-60 Months
Rate of Interest Not exceeding maximum rate of Interest prescribed by RBI

Nidhi company: Loan rules

  • A nidhi company can give loans up to following limits:
    Loan Amount Limits
    Rs.2,00,000 Total amount of deposit is less than Rs. 2 crores
    Rs.7,50,000 Total amount of deposit is more than Rs.2 crores and less than Rs.20 crores
    Rs.12,00,000 Total amount of deposit is more than Rs.20 crores but less than Rs.50 crores
    Rs.15,00,000 Total amount of deposit is more than Rs.50 crores .
      Loans can be disbursed against:
    • Gold, Silver and Jewellery
    • Immovable Property
    • Fixed Deposits Receipts, NSC, other govt securities and insurance policies
    • ROI: not exceeding 7.5% above the highest rate of interest offered on deposits by Nidhi.
    • Same rate of interest to be charged on same class of borrowers. ROI of all class shall be displayed on Notice Board at Registered Office of Nidhi.

    NOTE: Nidhi Company shall not raise loans from the banks or any financial institutions or any other source to advance the loans of its members.


A Nidhi company is a type of Non-Banking Financial Companies (NBFCs), which does not require any license from the Reserve Bank of India (RBI).

It is formed for the sole purpose of accepting deposits and lending loans to its members only.

No. A Nidhi company is registered as a Public Limited company with minimum 3 directors, 7 subscribers and a minimum paid up capital of Rs.10 lacs. The sole objective of the Nidhi company is receiving deposits from and lending to its members only for their mutual benefits.

A Nidhi company cnanot to accept deposits of more than 20 times of its Net Owned Funds as per its last audited financial statements.

Only shareholders/Members of the Nidhi Company, who have a membership ID, can invest in the scheme.

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, it will first have to apply for approval from the Regional Director.

Nidhi Companies are not allowed to provide or give unsecured loans to its Members and is not allowed to do Micro Finance Business and hence is only allowed to lend secured loans to its Members only.

This type of loan is not allowed under Nidhi Company. Vehicle finance is allowed to Non-Banking Financial Companies (NBFC) in India.

No. A Nidhi company cannot issue preference shares.

Yes. Every director of the Nidhi company shall be the member of the company.

The director of a Nidhi company holds office for a period of 10 consecutive years. After the expiry of this term, he can be re-appointed in the same nidhi company after a gap of 2 years from the date of expiry of 10 years.

Yes. Every deposit holder shall hold atleast 10 equity shares or shares of value Rs.100.

Yes. A Nidhi company can declare dividend up to 25% of the capital. It shall take approval from the Regional Director for declaration of dividend exceeding 25%.

No. Nidhi companies are not allowed to acquire the shares of any other company, nor they are allowed to control the management of any other company.

A Nidhi company shall have atleast 200 members within 1 year from the date of incorporation of the company. If Nidhi company fails to appoint 200 members within the said time period then it can take extension of time from the Regional Director.

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