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.
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.
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.
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.
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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