nidhi

Nidhi is a term with roots in Sanskrit meaning treasure or fund. In everyday use across Indian languages, it denotes savings, wealth, or a financial reserve, and it is also a common given name.

In Indian finance, Nidhi refers to a class of financial institutions known as Nidhi Companies. These are mutual-benefit societies registered as companies under the Companies Act and governed by the Nidhi Rules, 2014. Their primary objective is to foster thrift among members and to provide a safe place to save and obtain credit.

Operations and restrictions: Nidhi Companies are member-based entities that accept deposits from and lend to their own members only. They are not allowed to solicit deposits from the general public or engage in activities outside lending to or borrowing from members. Their activities are generally limited to member lending and savings, and they must comply with governance and financial requirements set forth in the Nidhi Rules, including standard audits and filings.

Regulation and oversight: Nidhi Companies are regulated by the Ministry of Corporate Affairs under the Companies Act and the Nidhi Rules, with oversight by the Registrar of Companies. They are not banks, and deposits are not insured by a government deposit insurance scheme. The Reserve Bank of India does not regulate Nidhi Companies as it does banks or other NBFCs; Nidhi compliance focuses on statutory and fiduciary safeguards specific to mutual benefit societies.

In culture and names: Beyond finance, Nidhi also appears as a personal name in India.