Annual Compliance of Nidhi Company

Compliance requirements under Nidhi Companies are divided into three parts:
1. First is pre-incorporation compliances
2. The second is post –incorporation compliance
3. The third is event-based compliances
 Pre-Incorporation compliances of Nidhi Company Every Nidhi Company has to follow some mandatory compliance to obtain Nidhi Company registration. The necessary compliances to be followed are mentioned below:
1. A minimum of seven members is needed to start a Nidhi Company, out of which three members must be the directors of the company.
2. The company must have the suffix “Nidhi Limited” in its name and the company must be a public company.
Minor, Body Corporate and a Trust cannot be admitted as members of Nidhi.
3. The minimum paid-up share capital must be Rs. 5 lakh.
4. Nidhi company cannot open branches if it has not earned any profit after tax for consecutive three financial years. 
5. The rate of interest on the loan shall not exceed 7.5% above the highest rate of interest offered on deposits.
6. The company cannot issue preference shares, in the case where such shares have been issued by the company before the commencement of the Act, the same shall be redeemed.
7. The primary objective of the company must be to inculcate the habit of savings in its members.
Latest MCA Update (16th July 2024):  As per this MCA notification, the Nidhi Rules, 2014 now state that a company cannot use "Nidhi Limited" in its name unless the Central Government officially declares it a Nidhi or Mutual Benefit Society in the Official Gazette under section 406 of the Act. In the Nidhi Rules, 2014, in rule 4 (5), the following proviso will be inserted “Provided that a company shall not use the words “Nidhi Limited” in its name unless it is declared as such under sub-section (1) of section 406 of the Act.”. The existing provision is "Every Company incorporated as a “Nidhi” shall have the last words ‘Nidhi Limited’ as part of its name."