Nidhi Company Registration: Rules, Process and Compliance
Publishing Date: 7 October, 2026
A Nidhi company is a public limited company formed to promote saving among its members. It accepts deposits from members and lends to members, usually against gold, property or fixed deposits. Nidhis are common in South India and are now registered across the country.
Key features
- Formed as a public limited company under the Companies Act, 2013
- Governed by the Nidhi Rules, 2014, as amended
- Deals only with its members
- The name must end with "Nidhi Limited"
Minimum requirements
| Requirement | At incorporation | After incorporation |
|---|---|---|
| Members | 7 | At least 200 within the time set by the rules |
| Directors | 3 | 3 or more |
| Equity share capital | Rs 10 lakh | — |
| Net owned funds | — | At least Rs 20 lakh |
| NOF to deposits ratio | — | Not more than 1:20 |
Registration process
- DSC for the directors and name approval with the "Nidhi Limited" suffix.
- Incorporation through SPICe+ with MOA and AOA limited to Nidhi objects.
- Bank account and INC-20A for commencement of business.
- Build membership and net owned funds to the required levels.
- File Form NDH-4 for declaration as a Nidhi; MCA reviews it before approval.
What a Nidhi cannot do
- Chit funds, hire purchase, leasing or insurance business
- Issue preference shares, debentures or other debt instruments
- Accept deposits from or lend to non-members
- Advertise for deposits or pay brokerage to mobilise them
- Acquire control of another company
Ongoing compliance
- Annual ROC filings (AOC-4, MGT-7) and statutory audit
- Half-yearly return in Form NDH-3
- Maintaining interest rate caps, loan limits and liquid asset requirements
Before applying, make sure your team can reach 200 members and maintain strict records. Our Nidhi company registration service covers incorporation and NDH-4.
Why Choose Vaidam Consultancy?
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Frequently Asked Questions
Q1. Is RBI approval needed for a Nidhi company?
No. A Nidhi is regulated by the Ministry of Corporate Affairs under the Nidhi Rules, 2014, not licensed by RBI, though RBI can issue directions on deposits.
Q2. Can a Nidhi lend to non-members?
No. A Nidhi can accept deposits from and lend only to its members.
Q3. What is NDH-4?
It is the application to the Central Government for declaration as a Nidhi, filed after the company meets the membership and net owned fund conditions.
Q4. Can a Nidhi open branches?
Yes, subject to conditions in the Nidhi Rules, including profitability and intimation requirements.
Related guides
Mukul Tomar writes Vaidam Consultancy’s guides on company registration, GST, income tax and ROC compliance. An experienced blog writer on Indian tax and business law, his articles have also been published on TaxGuru. He turns complex rules into clear, practical steps that business owners can act on.
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