As a part of the Companies ACT 2013, a Nidhi Registered company is a non banking finance sector company. A Nidhi Company is put for the benefit of the members. The soul of the Nidhi Company function is to borrow and lend money between the members. A Nidhi registered company can also be called as a Mutual fund, Beneficial fund and Permanent fund company. Nidhi falls under the Non Bank Financial Company (NBFC) where the rules are governed by Reserve Bank of India (RBI), as a result of this RBI has the power to direct how the company accepts the deposit and as such. However, since Nidhis deal with their shareholder-members only, RBI has exempted such notified firms from the core provisions of the RBI Act and other directions applicable to NBFCs. It should contain Nidhi Limited in its name.
Presently law revised on 2014 governs the Nidhi Company rules, they are incorporated in the Public Registered Company. There is no need to clear any approval from RBI in order to incorporate a Nidhi Company, as RBI has specifically exempted this category of NBFC in India to comply its core provisions such as registration with RBI.
The concept of Money lending and borrowing between the members of an incorporation dedicated to this purpose solely, but not with the same set of rules and standardization. The process was conceptualized to inculcate the habit of savings and self reliance.
At Unilex Consultants we provide you a hassle free registration process which would be dealt by our professionals within a time frame of 10 days and is subjective to governmental processing time. Our team takes care of the documentation and aids in provide you the realistic estimation of cost.
Limited Liability plays an major role in the decision as the partners are limited to the actions they make for the shares.
The company would exist in succession fashion as the governmental body treats it as a separate entity in terms of law.
The main reason many opt to go with Nidhi Corporation is that as the funding are circulated and dealt with the members alone and there is no outsider involved in the transaction there is no need of any sort of licensing from the end of RBI.
A Nidhi company scores better in terms of credibility as it falls under the central government directly unlike other mutual profit organizations.
Incorporating a Nidhi Company is easy as there is no complex licensing involved with RBI and the turnaround time are not that much either.
The main point of Nidhi Company is to channelize the deposit funds between the members and help them to be self reliant in terms of savings and other activities.
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