Nidhi Finance Company Is An Alternative To Bank

Nidhi alternate to Bank

Nidhi Finance Company Is An Alternative To Bank

Nidhi means a treasure, where money has been borrowed from its Members by way of issuing Fixed Deposit (FD), RD, Savings accounts etc.

In India, to start the Nidhi Business is very easy and no need to take any License from Reserve Bank of India (RBI).  Nidhi business is popular in few States Like Tamilnadu, AP, where it has highly been localized., where they run the Nidhi business by taking deposit and lending the money to members by taking collateral as Gold/ jewellery, property, Fixed Deposit, Insurance policy etc.

Read more about Nidhi Company? click Nidhi Company here.


Registration of Nidhi Company:

Nidhi Company has been regulated by the Ministry of Corporate Affairs (MCA), under section 406 of the Company Act, 2013. With initial 7 members, by registering with MCA.

The registration can be done within 7 working days, and business can start within 15 days post opening a current account with any Bank.


Details are documents required for registration of Nidhi

Proposed Nidhi business Name ending with Nidhi Limited.

7 members Pan, aadhar, photo, address proof, and email, mobile number

Rent agreement and electric bill of the business place

Digital signature of 7 members

DIN number of 3 directors


Conditions before starting of Nidhi Company.

Since Nidhi company is a Public Limited company, it has compiled the below:


Minimum 3 directors and 7 members are required to register the Nidhi Business.

Minimum capital Rs.5 Lac required

Within one year from registration, the minimum of 200 members and subscribed capital is Rs.10 Lac.



Advantages under Nidhi Business:

Encourage the members the habit of savings

Receive deposits and lend them to its members with favourable interest rates.

Provide an opportunity to run like banking system as per  Nidhi rules.

Easy to start with an initial capital of Rs. 5 Lac by subscribing from its members.

No RBI license or permission required to run the business, hence its lesser compliance

It provides easy access of loans to its members without much documentation.



restrictions under Nidhi Business:

To undertake hire purchase, chit fund, leasing finance, acquisition of securities or insurance.

To issue preference debentures or shares.

To open the current account of the company member.

To issue any type of advertisement, fore business rule click to read Nidhi Rules here


Yearly Filings under Nidhi Business:

Filings with MCA and Income-tax as follows

Half-yearly return NDH-3 with MCA (within 30 days from close of half year)

yearly return NDH-1  with MCA 9wihtin 90 days from close of year-end)

Annual return Aoct-4, MGT-7

Annual Income-tax return

Reporting of Resolutions passed during the year as a Public Company.



Since Nidhi Company has been regulated by the Ministry of Corporate Affairs MCA, and the rule framed are mainly to protect the members and benefits where commercial bank’s are not accessible to common people, and the Nidhi company plays a vital role as financial intermediation, and it has been servicing Nidhi Micro finance Company is an alternative to Bank. with less compliance, easy to start with few members.

As there is no special license or regulation from RBI, so it can be managed with a few people for the betterment of their members and improve the economy by taking deposits and lending.


Team IN Filings, is Business management. helping people to run the companies/Businesses, support them in Audit, CA (Chartered Accountant) services. Provide Business plan, setup, registration, Maintain the services with affordable fee.

Team IN Filings is a top Business consultant in Bangalore, an expert in Business and Tax Planning, Registration of trademark, Fssai, ISO, startup India, Dpit, eKarmika, Gst, Ca service, company Registration, PF, EPF filing, Esi, Tds management etc, For more about the Nidhi Company and its registration, please reach us

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