October 7, 2026 · Guides

Nidhi Licence: Is There One, and Does RBI Regulate Nidhi?

People search for a nidhi licence (or nidhi license) expecting a certificate from the RBI, and the honest answer is that no such thing exists. A Nidhi company is not licensed by the RBI and it is not an NBFC. What it needs instead is a declaration from the Central Government under NDH-4, and until it holds that declaration it cannot take deposits or lend. This post sorts out the terms and who actually regulates a Nidhi.

In this guide

Is there a Nidhi licence?
The NDH-4 declaration, which is the real licence
Does RBI regulate a Nidhi?
Nidhi, NBFC and bank compared
Other registrations and filings
Related reading
FAQs

Is there a Nidhi licence?

Not in the sense of an RBI or bank-style licence. Every searcher who types “nidhi company license” or “nidhi rbi” is really asking one of two things: what permission does a Nidhi need to start, and who supervises it afterwards. The permission is the NDH-4 declaration. The supervisors are the corporate authorities described below.

The NDH-4 declaration, which is the real licence

A company incorporated as a Nidhi applies for a declaration by the Central Government in Form NDH-4 within 120 days of incorporation. The conditions on the application are at least 200 members and net owned funds of at least Rs 20 lakh. Promoters and directors must also meet the fit and proper criteria. The Central Government has 45 days to decide, and if it does not, the application is treated as approved.

If the declaration is not obtained, or the application is rejected, the company cannot take deposits from members or lend to them. That is why people call it a licence. The step-by-step is in our Nidhi company registration guide.

Does RBI regulate a Nidhi?

A Nidhi is not an NBFC registered with the RBI, and it is not a bank. It is governed by the Companies Act, 2013 and the Nidhi Rules, 2014, and supervised through the Ministry of Corporate Affairs: the Registrar of Companies, the Regional Director and the Central Government. One point of contact with RBI does exist. The Rules tie the ceiling on deposit interest to the rate the RBI prescribes for NBFC deposits. That is a reference point for the rate, not supervision.

The legal basis sits in Section 406, covered in Nidhi company under the Companies Act 2013.

Nidhi, NBFC and bank compared

Point	Nidhi	NBFC	Bank
Regulator	MCA	RBI	RBI
Customers	Own members only	Public	Public
Current accounts and cheques	No	No	Yes

Read Nidhi company vs NBFC if you are deciding between the two. If your plan involves a banking-style name, see Nidhi bank, urban bank and small finance bank.

Other registrations and filings

Besides NDH-4, a Nidhi files NDH-1 with the Registrar after its first financial year (and the second, where applicable) and NDH-3 as a half-yearly return, along with the usual company filings. Due dates change, so check the MCA portal. For the meaning of the terms, see what is a Nidhi company.

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

FAQs

Does a Nidhi company need an RBI licence?

No. A Nidhi is not an NBFC and is not registered with the RBI. Its permission to operate is the Central Government declaration under NDH-4.

What is the Nidhi company licence?

The Central Government declaration under Form NDH-4, which a new Nidhi applies for within 120 days of incorporation.

Who regulates a Nidhi company?

The Ministry of Corporate Affairs, through the Registrar, the Regional Director and the Central Government, under the Companies Act and the Nidhi Rules.

What if the NDH-4 application is rejected?

Then the company cannot take deposits from members or lend to them. Fix the shortfall, such as member count or net owned funds, and take advice on the next step.