Nidhi Company Registration
Nidhi Company Registration
A “Nidhi company” is a company that manages “deposits from and loans to” it’s members (shareholders) only, and works for their mutual benefits.
Accordingly, certain exemptions have been provided to a “Nidhi Company”, in respect of annual compliances and tax assessment.
Nidhi Company Registrationin India are formed, administered, and controlled by Section 406 of the new, “Companies Act, 2013”, the Companies (Nidhi Companies) Rules of 2014, and the Chapter XXVI of the Companies Rules, 2014
The objective of incorporating a Nidhi Company is to encourage savings among its members. Nidhi companies are allowed to take a “deposit from and lend to” it’s members only. At the end of the day, the assets added to a Nidhi company come distinctly from its members and are to be utilized uniquely by the investors of the Nidhi Company.
The name “Nidhi” in Nidhi Company signifies “treasure” and it has its roots in the Hindi vocabulary.
Nidhi Company is a specific class of NBFC. Though not directly regulated by the RBI, still RBI has powers to issue directives for them related to their deposit acceptance activities. Moreover, because these “Nidhi companies” deal with their members (shareholders) only, they have been exempted from the core provisions of the RBI Act and other directions applicable to NBFCs. Accordingly, a Nidhi Company is a perfect lawful element to take a “deposit from and loan to” a particular gathering of members.
Nidhi Company Registration
Section 406 of the “Companies Act, 2013” and the Companies (Nidhi Companies) Rules of 2014, provide all the arrangements concerning the joining and administration of a Nidhi Company in India.
The rules and directives for the Nidhi Companies are likewise given by the RBI. These are chiefly identified with financial activities and investments by companies including the NBFCs.
The interest charged on loans under a Nidhi Company is very sensible. The advances are given against security as it were. The deposits under Nidhi do not earn much interest as compared to deposits in the sorted out banking sector.
All lending and borrowing of the Nidhi Companies are done by its members, exclusively. Consequently, such organizations additionally allude to Mutual Benefit Societies.
In the event when you are hoping to begin a business in financing or advances in India, a Nidhi Company is the best choice for it.