October 7, 2026 · Guides

Nidhi Company Registration in India: Process, Documents, Cost and Timeline

Nidhi company registration is a two-stage job. First you incorporate a public company on the MCA portal; then you apply to the Central Government for a declaration that lets it start taking deposits from members. Plenty of founders assume the first stage is the whole thing. It is not, and the second stage is where most of the delay and most of the rejections happen. This guide walks the full route, from the name to the first return.

In this guide

What a Nidhi company is
Eligibility and basic requirements
Registration process
Documents you will need
Cost of registration
Timeline
NDH-4: the step after incorporation
Rules you must run the company by
Ongoing compliance
Related reading
FAQs

What a Nidhi company is

A Nidhi company, also called a Nidhi Co or Nidhi Limited, is a mutual benefit company under Section 406 of the Companies Act, 2013 and the Nidhi Rules, 2014. It takes deposits from its own members and lends only to its own members. The one permitted object is to cultivate thrift and savings among them. Our explainer on what a Nidhi company is gives the long version, and the Section 406 post covers the legal side.

Three misunderstandings come up in almost every first meeting. A Nidhi is not an NBFC registered with RBI, so there is no RBI licence to apply for; the permission that matters is the NDH-4 declaration, which we cover in Nidhi licence and RBI. A Nidhi is not a bank either, and it cannot offer current accounts or cheque facilities to the public. And it cannot take a rupee from a non-member, however friendly the outsider. If you are still deciding between this and a finance company, read Nidhi vs NBFC before you spend anything.

Eligibility and basic requirements

The Nidhi Rules fix the structure quite tightly. Here is what you need on day one.

Item	Requirement
Type of company	Public company
Name	Must end with “Nidhi Limited” (Rule 4)
Members at incorporation	7
Directors	At least 3
Paid-up equity capital	Minimum Rs 10 lakh (raised from Rs 5 lakh on 19 April 2022)
Object	Thrift and savings; deposits from and loans to members only
Preference shares	Not allowed

Existing Nidhis were given 18 months to meet the higher capital figure. For a new company there is no such grace, so the money has to be ready. We break down who sits where in members, directors and structure, and how much money you actually need in capital needed to start a Nidhi.

Registration process

The route is the same one used for any public company, with a Nidhi-specific name and object. In short:

Get Digital Signature Certificates for the proposed directors, and apply for DIN where a director does not have one.
Reserve a name through SPICe+ Part A. It must end with “Nidhi Limited”.
Prepare the e-MOA (INC-33) and e-AOA (INC-34) with the single Nidhi object and the Rule 6 restrictions built in.
File SPICe+ (INC-32) with the registered office proof; PAN and TAN are applied for in the same form.
Receive the certificate of incorporation, then open the company bank account and bring in the share capital.
Enrol members and build towards 200 of them, while the paid-up capital and net owned funds reach the NDH-4 thresholds.
File NDH-4 within 120 days of incorporation.

Each step has its own traps, and we have written them out in the step-by-step registration process. If you want to know exactly what happens on screen, the online registration on the MCA portal post takes you through it. You can also see our own Nidhi registration service page for how we handle the filings.

Documents you will need

You collect papers for the people, then for the premises.

For each director and subscriber: PAN, Aadhaar or other identity proof, address proof, a recent photograph, email and mobile number, and a valid DSC.
For the registered office: proof of ownership or a rent agreement with the owner’s no-objection letter, plus a recent utility bill.
Subscriber declarations and the directors’ consent to act, which are generated during the SPICe+ filing.

Mismatched names between PAN and Aadhaar, or a utility bill that is too old, hold up more filings than anything else. The full checklist with examples is in documents required for Nidhi company registration.

Cost of registration

Cost has four parts: government and MCA fees, state stamp duty where it applies to the MOA and AOA, professional fees, and the Rs 10 lakh or more of share capital. That last item is not an expense. It is your own money sitting in the company’s bank account, and you need it there.

We are not going to print exact government fees here, because they change and depend on the authorised capital and your state. For our professional fee, ask us for a quote and we will give you a fixed figure after a short call. The cost and charges post lists every line item to expect, so you can compare quotes properly.

Timeline

Incorporation depends on how quickly the name is approved and whether the Registrar raises a query, so we do not promise a fixed number of days. The deadlines that are fixed are these.

Step	Time limit
Commencement of business (INC-20A)	Within 180 days of incorporation
NDH-4 application	Within 120 days of incorporation
Central Government decision on NDH-4	45 days; deemed approved if there is no decision

Put the 120-day window on the calendar the day the certificate arrives. The post on how long Nidhi registration takes maps the whole stretch from incorporation to declaration.

NDH-4: the step after incorporation

Incorporation alone does not let you take deposits. A company incorporated as a Nidhi has to apply on NDH-4 within 120 days (Rule 3B, added in 2022), and the application carries conditions: at least 200 members and net owned funds of at least Rs 20 lakh. Before 2022 the NOF figure was Rs 10 lakh. Promoters and directors also have to meet the fit and proper criteria.

The Central Government has 45 days to decide. If it does not, the application is deemed approved. If the declaration is refused or never obtained, the company cannot accept deposits from members or lend to them. Why applications get rejected, and how to avoid it, is in NDH-4 for a Nidhi company. If net owned funds are new to you, our post on net owned fund explains how the number is worked out.

Rules you must run the company by

Once the declaration is in hand, the Nidhi Rules govern day-to-day business. These are the figures as we read them; please confirm the current text of the Rules before you rely on them.

Area	Rule
NOF to deposits	Not more than 1:20
Unencumbered term deposits	At least 10% of outstanding deposits, with a scheduled commercial bank in the Nidhi’s own name (Rule 14)
Fixed deposits	6 to 60 months
Recurring deposits	12 to 60 months
Savings account balance	Capped at Rs 1 lakh
Loan size per member	Rs 2 lakh where deposits are under Rs 2 crore, rising to Rs 15 lakh above Rs 50 crore
Loan interest	Not more than 7.5% above the highest deposit rate, on a reducing balance

Loans can be secured against gold or jewellery, immovable property, fixed deposits, government securities or insurance policies. The Rules also bar a Nidhi from chit funds, hire purchase, leasing, insurance business, buying securities, current accounts, lending to bodies corporate, taking deposits from non-members, advertising for deposits and paying brokerage on them. Since 2022 it may borrow from banks and financial institutions to lend to members. A member cannot transfer more than 50% of the shareholding while a loan or deposit with the company is outstanding, and dividends are commonly stated to be capped at 25% of paid-up capital in a year. Each of these is covered in the Nidhi Act and Rules 2014 explained.

Ongoing compliance

A Nidhi carries the usual company filings and a few of its own. Always check current due dates on the MCA portal, since extensions and circulars move them.

Filing	What it is	Usual timing
NDH-1	Return of statutory compliances, filed with the Registrar	Within 90 days of the close of the first financial year after incorporation, and the second where applicable (Rule 5(2))
NDH-2	Application to the Regional Director for extra time if the members, NOF or ratio conditions are not met	About 30 days after the financial year closes
NDH-3	Half-yearly return (Rule 21)	Within 30 days of each half year, so around 30 April and 31 October
AGM	Annual general meeting	Within 6 months of year end
AOC-4 and MGT-7/7A	Financial statements and annual return	30 and 60 days after the AGM
DIR-3 KYC	Director KYC	30 September each year
DPT-3	Return of deposits	30 June; confirm applicability with your CA

Late filing is costly. Under Rule 24 the fine can reach Rs 5,000 plus up to Rs 500 for every day the default continues. Our annual compliance checklist sets the year out month by month, and the NDH-1 and NDH-4 post deals with the two forms people mix up. Most Nidhis also find that a good software system makes the half-yearly and ratio checks painless; see how to choose Nidhi management software.

Need help with your Nidhi company? See our Nidhi company registration service, call +91 93117 95484, or write to mail@taxhint.in. For the software side, see our Nidhi management software.

FAQs

How much capital do I need to register a Nidhi company?

The minimum paid-up equity share capital is Rs 10 lakh since the 19 April 2022 amendment. Separately, the NDH-4 application needs at least 200 members and net owned funds of Rs 20 lakh, so plan your funding for that figure, not just the incorporation minimum.

Do I need an RBI licence for a Nidhi company?

No. A Nidhi is not an NBFC registered with RBI. The permission that counts is the declaration from the Central Government on form NDH-4, which you apply for after incorporation.

Within how many days must NDH-4 be filed?

Within 120 days of incorporation under Rule 3B. The Central Government has 45 days to decide, and if it says nothing in that time the application is treated as approved.

Can a Nidhi company take deposits from the public?

Never. Deposits and loans are for members only, and even members are off limits until the NDH-4 declaration comes through. Advertising to attract deposits is also prohibited.