NIDHI COMPANY REGISTRATION

‘Nidhi’ means treasure or to finance or fund. The main objective of the company is to build the habit of saving among its members. It is just like a public limited company and needs a minimum of seven members and three directors to register it. It is also known as ‘Mutual benefit companies’ this terminology is mainly used in the banking sector. They borrow money from their members and pay interest on such borrowing and lend to its members on specified interest rates. It works like a community among a group of people, the company took money from one person and gave it to another member, and it circulates the money among the other members of the company. They are incorporated with an aim to build a money reserve, receive deposits and lend money to its members. This structure is different from the other business forms in the sense that any person who is a member of Nidhi company can make deposits or borrow loans whenever the need arises. Any person can become part of the company and take the benefit of its activity only by taking part in the shares of the company. Anyone can start this business for the mutual interests of the members of the company.