Article of Association for Nidhi Company, Nidhi Company Registration, What is AOA, Article of Association, Ebizfiling

All you need to know on Article of Association for Nidhi Company Registration


The process of incorporating a Nidhi company in India is referred to as Nidhi Company Registration. The primary goal of incorporation is to encourage the habit of saving among its members. A Nidhi company can be formed with as few as seven members and as many as 200. You must submit an MoA and an AoA to register as a Nidhi Company. What exactly is AoA? Why is Nidhi Company Registration important? This blog has the answers to all of your questions. Let’s begin with an overview of the Nidhi Company and its requirements, followed by an explanation of the AOA (Article of Association) and its importance in a Nidhi Company.

Overview of the Nidhi Company

A Nidhi Company is a financial institution that is not a bank. It was established with the intention of borrowing and lending money to its members. It instils the habit of saving in its members and operates on the basis of mutual benefit. Nidhi Company does not require an RBI (Reserve Bank of India) licence, making it simple to establish. It is a public company with the last word “Nidhi Limited” in its name.

Requirements for forming Nidhi Company registration in India

  • The Nidhi Company requires a minimum of seven shareholders.
  • Three directors are required to incorporate a Nidhi Company effectively.
  • Preference shares will not be issued by the Nidhi organisation.
  • The Nidhi Company must have at least 200 shareholders or members by the end of the first year.
  • The mission of the organisation is to instil the habit of saving in its members by “accepting deposits” from them and “lending to” them only to maximise their individual and communal welfare.

What is AOA (Article of Association)?

The Article of Association (AoA) is a document that outlines the purpose of a corporation and specifies the rules that govern how it operates on a daily basis. This document outlines the activities that must be carried out within a corporation, such as the compilation and management of financial records and the method for appointing directors.

  • The Article of Association (AoA) could be interpreted as the “constitution of a corporation.” It specifies and explains the rules and regulations that govern the internal affairs of a company.
  • An organization’s Article of Association is also regarded as its user’s manual because they outline the organization’s mission and the strategies it will employ to achieve both its immediate and long-term goals.
  • The Article of Association of a corporation will typically include its legal name, address, purpose, equity capital, organisational structure, financial provisions, and shareholder meeting requirements.

Important Components of an Article of Association for Nidhi Company

  • Capital Clause: The number and type of shares that comprise a company’s capital will be specified in the Article of incorporation. In general, the capital of a company will always include at least one type of common share in some form or another. Furthermore, investors have a wide range of preferred stocks from which to choose. It contains information about a company’s total and maximum share capital.


  • Name Clause: It bears the logo of the company. It must be unique and cannot be similar to the name of another company. If the company is a private limited company, the name should end with “Private Limited,” while a public limited corporation’s name should end with “Limited.”


  • Subscription Clause: It contains the names and other information about each company subscriber, as well as the number of shares allotted to each subscriber.


  • Liability Clause: It defines the level of responsibility assigned to each member of the organisation. The company’s Article of Association must state whether it is limited by shares or by the guaranty. Furthermore, the Article of Association must state that the members of the organisation have limited liability.


  • Object Clause: It defines the level of responsibility assigned to each member of the organisation. The company’s Article of Association must state whether it is limited by shares or by the guaranty. Furthermore, the Article of Association must state that the members of the organisation have limited liability.

Importance of AOA for Nidhi Company Registration in India

  • This document serves as the organization’s constitution. It is a how-to manual for business management.
  • If these agreements are violated, the company may file a lawsuit against the offending member.
  • Every business activity should fall within the scope of the MoA and AoA.
  • The AoA establishes the rules that govern the organization’s internal interactions with its members.
  • It also describes the rights and responsibilities that come with being a member of the company.

Bottom Line

The AoA for Nidhi Company Registration is a document that outlines the objectives and goals of the company. It also contains the Articles of Association, which are the rules and regulations that govern the company. Before a company can be registered, the AoA must be approved by the Registrar of Companies.


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Author: zarana-mehta

Zarana Mehta is an MBA in Finance from Gujarat Technology University. Though having a masters degree in Business Administration, her upbeat and optimistic approach for changes led her to pursue her passion i.e. Creative writing. She is currently working as Content Writer at Ebizfiling.

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  • alangarikka pvt ltd

    23 Apr 2022

    Great job and thanks for filing annual compliance on time for our company.

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    18 Mar 2018

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