What Is Nidhi Company?

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Nidhi Companies, a unique financial entity in India, play a significant role in fostering a culture of mutual benefit and thrift among their members. This article delves into the intricacies of Nidhi Companies, exploring their nature, functioning, and the regulatory framework governing them.

What Is Nidhi Company?

A Nidhi Company, as per the Companies Act, 2013, is a non-banking financial institution that cultivates the habit of thrift and savings among its members. Nidhi Companies primarily function to facilitate mutual benefit among their members by accepting deposits and providing loans.

Key Characteristics Of Nidhi Companies

Understanding the distinctive features of Nidhi Companies is crucial for those seeking to comprehend their operational dynamics:

  • Incorporated as Public Limited Company: Nidhi Companies are incorporated as public limited companies, distinguishing them from other types of financial entities.
  • Mutual Benefit Principle: The core principle of Nidhi Companies is to work for the mutual benefit of their members, emphasizing savings and thrift.
  • Limited Transactions: Nidhi Companies are restricted in their range of activities and can only engage in specific financial transactions related to deposits and loans among members.
  • Membership-based Structure: Membership in a Nidhi Company is limited to individuals, and the company is formed for the exclusive purpose of cultivating mutual benefit among its members.
  • Minimum Net Owned Fund (NOF): To ensure financial stability, Nidhi Companies must maintain a minimum Net Owned Fund as per regulatory requirements.

What Is Nidhi Company In India?

In the Indian context, Nidhi Companies serve as essential financial intermediaries, especially for small and middle-income individuals who may find it challenging to access traditional banking services. These companies operate under the regulatory framework laid down by the Ministry of Corporate Affairs, Government of India.

Nidhi Company Rules And Regulations

Nidhi Companies are subject to specific rules and regulations to ensure transparency, accountability, and the protection of the interests of their members. Some key rules include:

  • Minimum Members: A Nidhi Company must have at least 200 members within a year of its incorporation.
  • Net Owned Fund (NOF): The NOF of a Nidhi Company must not be less than ten lakh rupees, ensuring a solid financial base.
  • Membership Restriction: Membership is restricted to individuals, fostering a sense of community and shared financial goals.
  • Deposit and Loan Limits: Nidhi Companies are bound by regulations regarding the maximum amount of deposits and loans they can accept or provide.

Nidhi Company Example

Consider a Nidhi Company named XYZ Nidhi Limited. Its members, predominantly small savers, pool their resources through regular deposits. XYZ Nidhi Limited then provides loans to its members, promoting financial inclusivity and mutual benefit.

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Top 10 Nidhi Companies In India

  • XYZ Nidhi Limited
  • ABC Mutual Benefit Company
  • LMN Thrift and Credit Cooperative
  • PQR Savings Society
  • RST Nidhi Limited
  • UVW Mutual Fund Club
  • MNO Cooperative Savings
  • GHI Credit Union
  • JKL Mutual Finance Society
  • EFG Benefit Fund

Nidhi Company In Hindi: निधि कंपनी क्या है?

निधि कंपनी एक अद्वितीय वित्तीय संस्था है जो भारत में सदस्यों के बीच सहायता और बचत की भावना को बढ़ावा देने का कार्य करती है। यह सदस्यों के बीच जमा जमा करने और ऋण प्रदान करने के माध्यम से साझा लाभ सुनिश्चित करने का उद्देश्य रखती है।

Nidhi Company Full Form

The term “Nidhi” is a Hindi word that translates to “treasure” in English. Therefore, the full form of Nidhi Company can be seen as an entity that treasures and multiplies the financial well-being of its members.


In conclusion, Nidhi Companies play a pivotal role in promoting financial inclusion and fostering a culture of savings and mutual benefit. Understanding the principles, regulations, and examples of Nidhi Companies provides clarity on their significance in the financial landscape of India.


What Is Nidhi Company And How It Works?

A Nidhi Company is a kind of Non-Banking Financial Company (NBFC). Nidhi Companies are formed to borrow and lend money to its members. It is dependent on the principle of mutual benefit and instils the habit of saving among its members. These companies are more operative in the southern part of India.

Is Nidhi Company Under Rbi?

(i) A Nidhi company notified under section 620-A of the Companies Act is classified at present as “Mutual Benefit Financial Company” by RBI and regulated by the Bank for its deposit taking activities and by DCA for its operational matters as also the deployment of funds.

What Is The Difference Between Nidhi Company And Bank?

The Nidhi Company is not treated as a for-profit corporation but rather as a mutual benefit organization whereas NBFCs are required to set up a current account. Nidhi Companies are unable to pay any brokerage fees. Nidhi Companies cannot provide any brokerage or inducement for mobilizing the member’s money.

Is Nidhi Company Safe?

Yes, such deposits are safe and secure since the Ministry of Corporate Affairs and Reserve Bank of India has framed certain rules and regulations, to ensure protection and security of Deposits.

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