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Hisho & Kanri
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Nidhi Company Registration

Build a member-owned mutual benefit financial company.

A Nidhi Company is a special class of Non-Banking Financial Company recognised under Section 406 of the Companies Act, 2013, formed with the sole objective of cultivating the habit of thrift and savings among its members — accepting deposits from members and lending back to those very members, for their mutual benefit.

Because a Nidhi Company deals exclusively with its own members, it is exempt from holding a separate RBI licence — a rare, low-cost route into regulated deposit-taking and lending. Getting the incorporation, the "Nidhi Limited" naming, and the mandatory NDH-4 declaration right from day one is what keeps that exemption intact, which is exactly where our Nidhi registration specialists come in.

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0Nidhi Companies Registered
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NIDHI LIMITED Mutual Fund Pool
Member Deposits
Loans to Members
Interest Earned
Member Growth
Sec. 406 Company RBI Licence-Exempt
Core Objects

What a Nidhi Company is actually allowed to do

The Nidhi Rules, 2014 deliberately keep the scope narrow — deposits and loans, only between the company and its own members. Here's the permitted lineup, at a glance.

Fixed Deposits

Members park lump-sum savings for a fixed tenure and earn a pre-agreed rate of interest, within RBI-aligned ceiling limits.

Core Deposit

Recurring Deposits

A disciplined monthly savings instrument that builds a lump sum over time — the product Nidhis are traditionally best known for.

Savings Deposits

Members maintain a running balance with the Nidhi and earn interest, subject to the deposit limits fixed under the Rules.

Loan Against Gold & Jewellery

The most common secured lending product — quick, low-risk credit against pledged gold ornaments.

Loan Against Property

Secured lending against immovable property, always capped by the property's value and the member's repayment capacity.

Loan Against Fixed Deposits

Members can borrow against their own FD or government security held with the Nidhi, without breaking the deposit early.

No Chit Funds or Insurance

Chit fund business, hire-purchase, leasing, insurance, and securities trading are expressly barred under the Nidhi Rules.

Members Only, Always

A Nidhi can never accept deposits from or lend to the general public — every transaction stays strictly within its membership.

The Structure

How the mutual benefit cycle branches out

One legal entity, two core branches, and every leaf feeding back into the same pool of members. This is the complete deposit-and-loan tree of a Nidhi Company.

NIDHI LIMITED Section 406 Mutual Benefit Co. DEPOSITS FROM MEMBERS LOANS TO MEMBERS Fixed Deposit Lump-sum, fixed tenure Recurring Deposit Monthly savings Savings Deposit Running balance Loan vs. Gold Secured, quick credit Loan vs. Property Immovable collateral Loan vs. FD Against own deposit

Every branch loops back to the same members — that closed loop is what defines a Nidhi Company's mutual-benefit model.

The Process

From incorporation to the NDH-4 declaration

Registering a Nidhi Company doesn't stop at the Certificate of Incorporation — here's the complete path through to earning your formal Nidhi status.

1

Assemble Your Members & Directors

We help you line up the minimum 7 members and 3 directors — usually the same people — and confirm each is eligible under the Nidhi Rules.

2

DSC & DIN Application

Every proposed director receives a Digital Signature Certificate and Director Identification Number, required to sign the incorporation forms.

3

Name Reservation ("... Nidhi Limited")

We reserve a unique name ending in "Nidhi Limited" through the RUN/SPICe+ Part A service, checked against existing companies and trademarks.

4

Drafting MOA & AOA

The Memorandum and Articles of Association are drafted with objects strictly limited to borrowing from and lending to members only.

5

SPICe+ Incorporation Filing

The complete incorporation application — including PAN, TAN, and EPFO/ESIC registration — is filed electronically with the Registrar of Companies.

6

Certificate of Incorporation

Once approved, the ROC issues your Certificate of Incorporation with the CIN — your Nidhi Company legally comes into existence.

7

Grow to 200 Members & ₹20 Lakh NOF

Within one year, the Nidhi must onboard at least 200 members and build up a Net Owned Fund of ₹20 lakh, which we help you track and pace.

8

NDH-4 Declaration of Status

Form NDH-4 is filed to formally declare the company as a Nidhi — the final step that unlocks full deposit and lending operations.

Eligibility

Who can register a Nidhi Company?

The Nidhi Rules, 2014 set out clear numeric thresholds on members, directors, and capital — miss any one of these and the registration gets rejected or delayed.

Minimum 7 Members, 3 Directors

Every Nidhi Company needs at least 7 shareholder-members and 3 directors at the time of incorporation, each over the age of 18.

₹10 Lakh Minimum Paid-Up Capital

A minimum equity share capital of ₹10,00,000 must be paid up before incorporation — preference shares are not permitted.

Only Indian Citizens as Members

Nidhi Companies cannot accept foreign direct investment — every member and director must be a resident Indian citizen.

Name Must End in "Nidhi Limited"

The proposed name must carry the "Nidhi Limited" suffix and must not be identical or deceptively similar to any existing entity.

No Prior Disqualification

Proposed directors must not be disqualified by the ROC due to past non-compliance, fraud, or insolvency proceedings.

Objects Limited to Members Only

The MOA must restrict the company's business to borrowing and lending among its own members — no other financial activity is permitted.

Paperwork

Documents every member and director must keep handy

With 7 members and 3 directors involved from day one, gathering these upfront is what keeps a Nidhi filing moving without back-and-forth queries from the ROC.

PAN Card

Of all 7 members and directors

Aadhaar Card

For identity verification

Address Proof

Bank statement or utility bill

Photograph

Recent passport-size photo

Registered Office Proof

Rent agreement or title deed

Utility Bill

Recent electricity or water bill

NOC From Property Owner

Required if office premises are rented

Draft MOA & AOA

With objects limited to member deposits & loans

Why It's Worth It

What a Nidhi Company structure actually buys you

Beyond thrift-and-savings, a registered Nidhi gives your member community a regulated, low-cost financial vehicle without the overhead of a full NBFC licence.

No Separate RBI Licence

Exempt from RBI's core NBFC registration requirement

Limited Liability

Members' personal assets stay protected from company debts

Separate Legal Entity

The Nidhi can own assets and sue in its own name

Community Financial Inclusion

Brings organised savings & credit to local member groups

Low-Cost Credit for Members

Members borrow at rates set by their own mutual fund

Perpetual Succession

The Nidhi continues regardless of membership changes

Tax & Interest Benefits

Structured deposit products with predictable member returns

Lighter Compliance Than an NBFC

Simpler ongoing filings than a full-fledged finance company

After Registration

Staying compliant with the Nidhi Rules, year after year

Nidhi Companies carry compliance obligations most other structures don't — miss the NDH forms and you risk losing the exemption that makes a Nidhi worthwhile.

NDH-1 — Return of Statutory Compliance

Filed within 90 days of the financial year-end, detailing members, deposits, and Net Owned Fund position.

NDH-2 — Extension of Time

An application to the Regional Director for extra time, if the 200-member or capital thresholds aren't met within a year.

NDH-3 — Half-Yearly Return

A half-yearly return on membership, deposits, and loan exposure, filed twice every financial year.

NDH-4 — Nidhi Status Declaration

The formal declaration confirming the company has fulfilled all Nidhi Rules conditions and can operate at full scale.

Net Owned Fund to Deposit Ratio

Deposits outstanding must never exceed 20 times the Nidhi's Net Owned Fund — a ratio we help monitor every quarter.

AOC-4 & MGT-7 Annual Filing

Annual financial statements and the annual return filed with the Registrar of Companies each year.

Statutory Audit

Annual audit of accounts by a qualified chartered accountant, as required for every registered company.

Why Hisho & Kanri

Nidhi registration handled by people who track the NDH forms daily

Nidhi Companies live and die by a handful of ROC forms most CAs rarely touch — we file them routinely, so your exemption status never lapses.

Nidhi Rules Specialists

Professionals who track NDH-1 through NDH-4 timelines for every client, every year.

Fast Incorporation

Name reservation, MOA drafting, and SPICe+ filing handled without back-and-forth delays.

Membership Growth Support

We help you plan the path to 200 members and ₹20 lakh NOF within the first year.

Transparent Process

You see every filing and status update, not just a final certificate.

Dedicated Support

One point of contact from your first call through incorporation and NDH-4.

Secure Documentation

Member and company documents handled under strict confidentiality.

FAQ

Common questions about Nidhi Company registration

Can't find your question here? Use the form alongside this page and we'll answer it directly.

It's a company recognised under Section 406 of the Companies Act, 2013, formed solely to encourage savings among its members and lend that pooled money back to those same members.

A minimum of 7 members and 3 directors at incorporation, growing to at least 200 members within the first financial year.

₹10,00,000 in paid-up equity share capital at incorporation, rising to a Net Owned Fund of ₹20,00,000 within the first year of operation.

No. Deposits can only be accepted from, and loans only extended to, its own registered members — never the general public.

No, Nidhi Companies cannot raise Foreign Direct Investment — every member and director must be a resident Indian citizen.

Incorporation itself typically takes 12–15 working days once documents are in order; the NDH-4 status declaration follows later, after the 200-member threshold is met.

It's the declaration that formally confirms your company has met all Nidhi conditions — without it, the company cannot open new branches or the exemption risks becoming unstable.

An NBFC needs a separate RBI licence and can deal with the public; a Nidhi is exempt from that licence precisely because it only ever deals with its own members.

Yes, up to 3 branches within the same district after the first NDH-4 filing; opening more, or branching outside the district, needs Regional Director approval.

PAN, Aadhaar, address proof, and photographs of all members and directors, plus registered office proof and the draft MOA/AOA — see the Documents section above for the full list.

NDH-1, NDH-3 half-yearly returns, AOC-4 and MGT-7 annual filings, and a statutory audit — see the Compliance section above for the complete calendar.

Because we track NDH-form deadlines that most professionals overlook, guide you through the 200-member growth phase, and stay on for compliance long after incorporation.