What is Nidhi Company?
Nidhi company is a company incorporated under Section 56 of Companies Act of 1956. It is a type of NBFC (Non-Banking Financial Company). The main motto of Nidhi company is to promote savings and thrift among its members. Nidhi company is most popular in South India and is more widely known under different names as Nidhi, Permanent Fund, Benefit Funds, Mutual Benefit Funds and Mutual Benefit Company.
Nidhi business structure is limited only to its members. Receiving deposits from the members and lending of loans only to its members at reasonable interest rates for mutual benefit. Every Nidhi Company is governed by the Ministry of Corporate Affairs (MCA) and all its financial ledgers are contemplated by RBI(Reserve Bank of India).
Page Contents
Cheaper Interest Rates: Nidhi companies lend money at an interest comparatively lower than that of the bank loans. The mutual benefit of all the members of the company is assured as different individuals need money at different points of time.
Prudential Lifestyle: Nidhi company promotes a thrifty lifestyle amongst its members and encourages savings for the mutual benefit of each other.
Safer: Lending money to its known members are safer and involves fewer complications than that of loans of banks.
Registration of a Nidhi Company is an easy-peasy process. The process is completely online.
KYC of Directors and Members:
All the directors and members of the company must complete a KYC process. There should be at least three directors amongst the seven members.
Obtaining Digital Signature:
All the members are mandated to obtain the Digital Signature Certificate(DSC). It shall be used to digitally sign the documents.
Choosing the Name:
Three names are to be submitted to the Ministry of Corporate Affairs (MCA). Out of which MCA will choose one name for the company. The name should not resemble any previously established ventures. SPICe+ form will help in applying for the name of the company.
MoA and AoA:
Memorandum of Association and Article of Association are to be submitted. Reviewing those, Certificate of Incorporation will be issued.
Opening of Bank Account:
PAN, TAN, MoA and AoA are required to open a bank account and comply with the regulations of RBI.
Documents Required :
Pre-Registration Checklist:
Post-Registration Checklist:
A registered Nidhi Company shall not indulge in the business of Chit Fund, Hire Purchase Finance, Leasing Finance, Insurance or Acquisition of Securities issued by anybody corporate.
Membership:
Deposits:
Loans:
Restrictions are placed for providing loans to the members according to the deposit acquired by the company.
1. Loan amount 2 lakhs – If the deposit is two crores.
2. A loan amount of 7.50 lakhs – If the deposit is more than two crores but less than 20 crores.
3. A loan amount of 12 Lakhs – If the deposit is more than 20 crores but less than 50 crores.
4. Loan amount 15 lakhs – If the deposit is more than 50 crores.
Dividend:
The dividend should not exceed 25%.
Director:
A director shall be a member of the company. Tenure of the director is 10 years. A director is only eligible for re-appointment only after 2 years of resigning from the director of the company.
Branches:
kindly mention for fdr maturity of nidhi co. they are asking 3days notice before the maturity and fdr should have to be discharged to be given. They wont give maturity of deposit notice and after three days of present only the are issu;ing cheques presented to my bank including interest and maturity and some times after maturity they are giving interest amount after 6 days of maturity by depositing in my bank. In this unethical practice they are taking advantage of covid lock down and presenting the cheque after lock down. My amount of fdr maturing of 10.06.2020 presented for payment. But every deposit I am sending RTGS through Bank to their Head Office account Bank only, but they are diverting the funds to their various city branches and while maturity they are taking much time for presenting the chque to my bank and incuring losses of rs.17000/- for total amount of 2625000/- for one year deposit and directors are not giving their mobile nos and also in website and they are not informing on which date they are going to deposit my maturity cheque and interest and giving maturity cheque on 07.07 .2020 and interest cheque on 13.07.2020. In this situation I have sent my grievances through MAIL TO THEIR MAIL ID AND ALSO THEIR WEBSITE MAIL ALSO WHICH SHOWS 24 HOURS REPLY YOU WILL GET AND NO REPLY SO FAR FOR FOUR WEBSITE MAIL AND FIVE E-MAILS AND I HAVE SENT LETTER TO THE NIDHI CO. AND THROUGH MY REPRESENTATIVE AND THEY ARE REPLYING WE HAVE PAID INTEREST AND PRINCIPLE AND NOT RECEIVING THE LETTER. THEN ONCE AGAIN I SENT THAT LETTER COPY AND MY GRIEVANCES ONE FINAL MAIL THROUGH THEIR MAIL ID AND ALSO THEIR WEBSITE MAIL ID. IN THIS SITUATION KINDLY ADVICE ME TO GET THE COMPENSATION THROUGH WHICH BODY LIKE COMPANY LAW BOARD OR DEPT. OF COMPANY AFFAIRS OR RBI NBFC OMBUDSMAN 2018 AND HOW TO PROCEED . KINDLY EXPLAIN .