Nidhi Companies in India are formed to grow the habit of savings amongst its members. Borrowing from members and lending money to its members are allowed for nidhi companies. Thus, the funds donated to a Nidhi Company belong to its members or shareholders only. These companies are registered limited companies.
Basic features
As these Companies are identical to a NBFC, their activities are under the supervision of Reserve Bank of India. Since these Companies deal with the money of its shareholders’ money, they are exempted from the basic provisions and other rules of RBI that are pertinent to a NBFC. If you are in Kolkata, you can search with the phrase nidhi company registration online in Kolkata to get more information about the topic.
Restrictions of Nidhi Company
According to Rule 6 of Nidhi Rules, 2014, these companies are having a number of restrictions. This type of company cannot involve in the following activities:
According to Companies Act, 2013, in order to start this company, the first step includes incorporation of a limited company. For initiating the incorporation procedure of a limited company, at least 3 directors and 7 shareholders are required. If you want to incorporate your company in Kolkata, it is recommended to search with the phrase how to register nidhi company in Kolkata to get more information.
By reading the content, you have obtained an overview about the basics, restrictions and registration process. If you want to get more about us, it is recommended to OneClickBusinessSolutions.
Basic features
As these Companies are identical to a NBFC, their activities are under the supervision of Reserve Bank of India. Since these Companies deal with the money of its shareholders’ money, they are exempted from the basic provisions and other rules of RBI that are pertinent to a NBFC. If you are in Kolkata, you can search with the phrase nidhi company registration online in Kolkata to get more information about the topic.
Restrictions of Nidhi Company
According to Rule 6 of Nidhi Rules, 2014, these companies are having a number of restrictions. This type of company cannot involve in the following activities:
- Issuing preference shares, debentures or any other debt related instrument in any type or name
- Carrying the business of chit fund, leasing finance, hire purchase finance, acquisition of securities or insurance issued by any corporate unit
- Acquiring another company by purchasing securities or managing the composition of the Board of Directors of any other company in any manner for any change in its management except a special resolution has been passed in the general meeting and got the previous authorization from the regional director who is having jurisdiction over Nidhi.
- Opening current account with members
- Accepting deposits or lending money to any individual except its members
- Carrying on any other business excepting borrowing or lending in its own name, on condition that all the provisions of the rules are followed, may offer locker facilities on rental basis to its members depending on the rental income from such features not more than 20% of the gross income of the company at any time in a financial year.
According to Companies Act, 2013, in order to start this company, the first step includes incorporation of a limited company. For initiating the incorporation procedure of a limited company, at least 3 directors and 7 shareholders are required. If you want to incorporate your company in Kolkata, it is recommended to search with the phrase how to register nidhi company in Kolkata to get more information.
By reading the content, you have obtained an overview about the basics, restrictions and registration process. If you want to get more about us, it is recommended to OneClickBusinessSolutions.