{"id":14761,"date":"2024-07-11T17:40:10","date_gmt":"2024-07-11T12:10:10","guid":{"rendered":"https:\/\/www.startupfino.com\/blogs\/?p=14761"},"modified":"2024-07-11T17:40:12","modified_gmt":"2024-07-11T12:10:12","slug":"structure-and-organisation-of-nidhi-companies-in-india","status":"publish","type":"post","link":"https:\/\/www.startupfino.com\/blogs\/structure-and-organisation-of-nidhi-companies-in-india\/","title":{"rendered":"Structure and Organisation of Nidhi Companies in India"},"content":{"rendered":"\n

Nidhi companies are extremely important in the Indian financial sector for small investors & depositors to invest in a secure and controlled environment. These companies try to inspire saving and thriftiness among their people and use the savings for mutual benefit. This blog will provide a clear and simple explanation of what Nidhi companies are, the way they’re organised and how they operate.<\/p>\n\n\n\n

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What is a Nidhi Company?<\/strong><\/h2>\n\n\n\n

A Nidhi Company<\/a><\/strong> is an NBFC in accordance with the Companies Act, 2013. Unlike conventional banks, Nidhi companies lend and borrow money among members. The word ‘Nidhi’ itself means ‘treasure’ in Sanskrit, and the company’s mission is encouraging savings among its members.<\/p>\n\n\n\n

Basic Structure of a Nidhi Company<\/strong><\/h2>\n\n\n\n

This is what the basic structure of a Nidhi company registration requires:<\/strong><\/p>\n\n\n\n

1. Minimum Membership:\u00a0<\/strong><\/p>\n\n\n\n

A Nidhi company ought to have more than seven members. Of these, 3 must be directors.<\/p>\n\n\n\n

2. Membership Expansion:<\/strong><\/p>\n\n\n\n

The company must add 200 members Within a year of registration.<\/p>\n\n\n\n

3. Capital Requirements:\u00a0<\/strong><\/p>\n\n\n\n

The company has to have a net owned fund (NOF) of Rs. Ten lakhs or even more.<\/p>\n\n\n\n

4. Deposits: <\/strong> <\/p>\n\n\n\n

The company can accept deposits only from members.<\/p>\n\n\n\n

Main Functions of a Nidhi Company<\/strong><\/h2>\n\n\n\n

Nidhi businesses promote saving and investments among members. A few of the essential functions they perform are:<\/strong><\/p>\n\n\n\n

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  1. Encouraging Savings: <\/strong>Nidhi companies encourage members to save by providing members interest on deposits.<\/li>\n\n\n\n
  2. Providing Loans: <\/strong>Members borrow money from the company at low rates. This helps with financial and personal needs without the excessive costs of conventional banks.<\/li>\n\n\n\n
  3. Investment in Government Securities: <\/strong>The collected deposits are often invested in government securities and bonds.<\/li>\n<\/ol>\n\n\n\n

    Loan Structure & Restrictions<\/strong><\/h2>\n\n\n\n

    Nidhi companies have guidelines regarding how much money can be borrowed from the amount deposited. The following are are the guidelines:<\/strong><\/p>\n\n\n\n

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    1. For deposits of upto Rs. 2 crores: Members may borrow up to Rs. 2 lakhs.<\/li>\n\n\n\n
    2. For deposits from Rs. 2 crores & Rs. Twenty crores: Members may borrow up to Rs. 7.50 lakhs.<\/li>\n\n\n\n
    3. For deposits from Rs. 20 crore & Rs. Fifty crores: Members may borrow up to Rs. Twelve lakhs.<\/li>\n\n\n\n
    4. For deposits exceeding Rs. Fifty crores: Members may borrow up to Rs. Fifteen lakhs.<\/li>\n<\/ol>\n\n\n\n

      Tenure of Loan:<\/strong><\/h3>\n\n\n\n