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Nidhi (Amendment) Rules, 2022

S. No. Existing Rules Nidhi (Amendment) Rules, 2022
1 New insertion New Definition inserted

Rule 3(aa)

Branch’ means a place other than the registered office of Nidhi.

It means Nidhi Companies earned net profit as specified can have one registered office and three other branches within the district without obtaining any permission.

Earlier we used to consider Registered office as one of the branch office.
2 New insertion Fourth Proviso inserted in Rule 3A

The existing Companies which failed to comply with the requirements of filing NDH-4 with the Central Government shall not raise any deposits from its members or provide loan to its members from the date of non-compliance.

If deposits raised by the Company after the date of noncompliance shall be deemed to be raised in pursuance of Chapter of Acceptance of Deposits and shall need to comply with all the requirements under that chapter or under other provisions.

Above provisions shall not apply to Companies incorporated as Nidhi on or after the commencement of above rules because Rule 3B inserted for such companies as described in Point No. 3 below.
3 New insertion Rule 3B inserted after Rule 3A

A newly incorporated company after the commencement of Nidhi (Amendment), Rules 2022 shall have to file NDH-4 within 120 days of its incorporation fulfilling the following conditions:

1. It has not less than 200 members and
2. It has net owned funds of Rs. 20 Lakh or more


Further declaration regarding fit and proper criteria of person shall also attach in NDH-4.

A person shall not consider as fit and proper if incurring the following disqualifications:-

  • a) Criminal complaint filed against such person
  • b) Charge sheet filed against such person
  • c) An order of restraint, prohibition or debarment passed against person
  • d) An order of conviction passed against such person
  • e) Such person declared as insolvent
  • f) Such person found to be unsound mind
  • g) Such person categorised as wilful defaulter
  • h) Such person declared as fugitive economic offender
  • i) Such person is director in 5 or more declared Nidhi companies or is promoter of 3 or more declared Nidhi companies.
The Central Government shall take decision on NDH-4 within 45 days otherwise it shall be deemed as approved.

This decision shall also be filed in INC-20A and subsequent to the approval of INC-20A can commence its business.

If above provisions are not complied than company is not allowed to file e-form SH-7 and PAS-3.
4 A Nidhi Company shall have minimum paid up equity share capital of Rs. 5 Lakh Limit of minimum paid up equity share capital changed from Rs. 5 Lakh to Rs. 10 Lakh.

Every existing Company shall comply with above requirement within 18 months from the date of such commencement.
5 ---------- Requirement of minimum number of members, net owned funds etc. shall not applicable to companies incorporated as NIDHI after commencement of Nidhi (Amendment), Rules 2022.
6 Earlier Nidhi acquire or purchase securities or control with previous approval of Regional Director and passing special resolution. Nidhi Companies are totally restricted from purchase acquire or control the composition of any company.
7 Inserted restriction Nidhi Companies cannot raise Loans from banks, Financial institutions or any other source except raising from members.

Earlier no express restriction regarding this is given in rules.
8 New insertion Rule 8(4) inserted

During the subsistence of any loan or deposit, a member shall not transfer more than 50% of his shareholding.

Further member shall also maintain minimum no of shares as required under rules.

10 Equity Shares of Rs 10/- each for other

1 Equity Share of Rs 10/- each for savings account holder and a recurring deposit account holder
9 Every Nidhi shall maintain Net Owned Funds (excluding the proceeds of any preference share capital) of not less than 10 lakh rupees Every Nidhi shall maintain Net Owned Funds (excluding the proceeds of any preference share capital) of not less than 20 lakh rupees

Limit changed from Rs. 10 Lakh to Rs. 20 Lakh

Every existing Company shall comply with above requirement within 18 months from the date of such commencement.
10 Deletion of words such as collection centres or offices or deposit centres or by whatever name called Now Nidhi Company cannot open its offices with names such as collection centres or offices or deposit centres.

Any place not being registered office or branch shall be closed within 6 months from the commencement of Nidhi (Amendment), Rules 2022 and give intimation to registrar in form NDH-2.
11 New insertion Earlier no permission was required for closure of branch except advertisement in newspaper. Now Nidhi Company has to obtain approval from Regional Director in form NDH-2 for closure of Branch at least 60 days prior to such closure and give intimation to registrar in form NDH-2.
12 New insertion Earlier form was not specified for obtaining permission from Regional Director for opening more than three branches within the district or any branch outside the district. Now Form NDH-2 is specified for the above purpose.
13 New insertion Earlier Loans can be disbursed against Gold and Jewellers. Not Silver is also inserted for above purpose
14 New insertion Proviso is inserted in Rule 15(1)
In case of joint shareholders, the loan shall be provided to the member whose name appears first in the Register of members
15 Omitted Now Nidhi Companies are restricted to declare dividend not exceeding twenty five per cent in a financial year. Earlier higher amount of dividend may be declared as approved by the Regional Director
16 Revision in form NDH-2

Earlier Form NDH-2 was used only for filing Application for extension of time. Now Form NDH-2 is revised and following applications are filed in same form:

  • - For filing extension
  • - For permission of Regional Director for opening branch
  • - For permission of Regional Director for closure branch
  • - For intimation to Registrar for opening branch
  • - For intimation to Registrar for closure branch
  • - For permission of Regional Director for withdrawal of unencumbered deposits
17 Insertion of Form NDH-5 NDH-5 is introduced as format of advertisement to be given while closing branch