December 26, 2016
I. Introduction: Nidhi Company is a company incorporated as such with an objective of:
The companies which are covered under the Table in sub-rule (2) above shall not accept fresh deposits or renew existing deposits if such acceptance or renewal leads to violation of the prescribed ratio.
The ratio specified in sub-rule (2) above shall also apply to incremental deposits.
- Cultivating the habit of thrift;
- Saving amongst its members;
- Receiving deposits from its members; and
- Lending money to it members.
- A Nidhi Company should be incorporated as a public company under the Companies Act, 2013 (“the Act”) with paid up equity capital of five lakh rupees.
- After the Act came into effect no Nidhi company should issue preference shares.
- If preference shares are issued prior to commencement of the Act, they shall be redeemed as per the terms of their issue.
- Nidhi Company is created with the objective of cultivating the habit of thrift and saving amongst its members. They shall not persuade any other objects.
- It shall have the words “Nidhi Limited” as part of its name.
- Minimum number of members shall be 200.
- Net owned fund of ten lakhs or more.
- Unencumbered term deposit of not less than 10% of outstanding deposit.
- Ratio of net owned fund to deposit of not more than 1:20.
- business of chit fund, hire-purchase finance, leasing financing, insurance or acquisition of securities issues by a body corporate.
- they shall not issue debenture, preference shares, any other debt instrument whatsoever in any form.
- acquire another company through purchasing shares or control the composition of Board of Directors of any other company in any manner
- Enter into an arrangement for change of its management unless it has passed a special resolution in its general meeting and obtained prior approval from Regional Director having Jurisdiction.
- Carry on any business other than its own business in its name.
- Accepts deposits from and lend money to any person other than its members.
- Pledge any of the assets lodged by its members as security.
- Accept deposits from and lend money to any body corporate.
- Enter into any partnership arrangement in its borrowing or lending activities
- Issue or cause to be issued any advertisement in any form for soliciting deposit.
- Pay any brokerage or incentive or mobilizing deposits from members or for deployment of funds or the granting loans.
- Every Nidhi Company shall issue equity shares of the nominal value of not less than ten rupees each.
- No service charge shall be levied for issue of shares.
- Every Nidhi shall allot to each deposit holder at least a minimum of ten equity shares or shares equivalent to one hundred rupees: It may be noted that a savings account holder and a recurring deposit account holder shall hold at least one equity share of rupees ten.
|Ratio of Net Owned Funds to Deposits (as on 31.3. 2013)||Date by which the company has to achieve prescribed ceiling of 1:20|
|a) More than 1:20 but upto 1:35||By 31.3. 2015|
|b) More than 1:35 but upto 1:45||By 31.3. 2016|
|c) More than 1:45||By 31.3. 2017|
- The Director shall be a member of Nidhi.
- The Director of a Nidhi shall hold office for a term up to ten consecutive years on the Board of Nidhi (3) The Director shall be eligible for re-appointment only after the expiration of two years of ceasing to be a Director.
- Where the tenure of any Director in any case had already been extended by the Central Government, it shall terminate on expiry of such extended tenure.
- The person to be appointed as a Director shall comply with the requirements of Director Identification Number.
- A person shall not be eligible for appointment as a director of a Nidhi, if —
- he is of unsound mind and stands so declared by a competent court;
- he is an undischarged insolvent;
- he has applied to be adjudicated as an insolvent and his application is pending;
- he has been convicted by a court of any offence, whether involving moral turpitude or otherwise and sentenced in respect thereof to imprisonment for not less than six months and a period of five years has not elapsed from the date of expiry of the sentence. Provided that if a person has been convicted of any offence and sentenced in respect thereof to imprisonment for a period of seven years or more, he shall not be eligible to be appointed as a director in any company;
- an order disqualifying him for appointment as a director has been passed by a court or Tribunal and the order is in force;
- he has not paid any calls in respect of any shares of the company held by him, whether alone or jointly with others, and six months have elapsed from the last day fixed for the payment of the call;
- he has been convicted of the offence dealing with related party transactions under section 188 at any time during the last preceding five years; or
- an equal amount is transferred to General Reserve;
- there has been no default in repayment of matured deposits and interest; and
- it has complied with all the rules as applicable to Nidhis.
- two lakh rupees, where the total amount of deposits of such Nidhi from its members is less than two crore rupees;
- seven lakh fifty thousand rupees, where the total amount of deposits of such Nidhi from its members is more than two crore rupees but less than twenty crore rupees;
- twelve lakh rupees, where the total amount of deposits of such Nidhi from its members is more than twenty crore rupees but less than fifty crore rupees; and
- fifteen lakh rupees, where the total amount of deposits of such Nidhi from its members is more than fifty crore rupees:
- gold, silver and jewellery, and the re-payment period of such loan shall not exceed one year.
- immovable property and, the total loans against immovable property [excluding mortgage loans granted on the security of property by registered mortgage, being a registered mortgage under section 69 of the Transfer of Property Act, 1882 (IV of 1882)] shall not exceed fifty per cent of the overall loan outstanding on the date of approval by the board, the individual loan shall not exceed fifty per cent of the value of property offered as security and the period of repayment of such loan shall not exceed seven years.
- fixed deposit receipts, National Savings Certificates, other Government Securities and insurance policies. It may be noted that such securities duly discharged shall be pledged with Nidhi and the maturity date of such securities shall not fall beyond the loan period or one year whichever is earlier and in the case of loan against fixed deposits, the period of loan shall not exceed the unexpired period of the fixed deposits.