A Nidhi shall provide loans only to its members.
A Nidhi shall give loans to its members only against the following securities, namely:-
(a) gold, silver and jewellery:
Provided that the repayment period of such loan shall not exceed one year.
(b) immovable property:
Provided that the total loans against immovable property shall not exceed fifty per cent. of the overall loan outstanding on the date of approval by the board, the individual loan shall not exceed fifty per cent. of the value of property offered as security and the period of repayment of such loan shall not exceed seven years.
(c) fixed deposit receipts, National Savings Certificates, other Government Securities and insurance policies:
Provided that such securities duly discharged shall be pledged with Nidhi and the maturity date of such securities shall not fall beyond the loan period or one year whichever is earlier:
Provided further that in the case of loan against fixed deposits, the period of loan shall not exceed the unexpired period of the fixed deposits.
MAXIMUM LOAN LIMIT OF A NIDHI COMPANY:
| IF DEPOSIT AMOUNT IS | THEN LOAN LIMIT IS |
| LESS THAN RS. TWO CRORE | RS. TWO LAKHS |
| MORE THAN TWO CRORE RUPEES BUT LESS THAN TWENTY CRORE RUPEES | RS. SEVEN LAKH FIFTY THOUSAND |
| MORE THAN TWENTY CRORE RUPEES BUT LESS THAN FIFTY CRORE RUPEES | RS. TWELVE LAKH |
| MORE THAN FIFTY CRORE RUPEES | RS. FIFTEEN LAKH |
Provided that where a Nidhi has not made profits continuously in the three preceding financial years, it shall not make any fresh loans exceeding fifty per cent. of the maximum amounts of loans
Provided further that a member shall not be eligible for any further loan if he has borrowed any earlier loan from the Nidhi and has defaulted in repayment of such loan.
SO, ONLY SECURED LOANS TO ITS MEMBERS WITHIN THE ABOVEMENTIONED LIMITS ARE ALLOWED.
NIDHI is not allowed to give any loans which are mentioned below:
Any type of unsecured loan: Nidhi can not grant any loan, by whatever name called, which is unsecured in nature. More specifically it can not grant loans stated as below.
Personal Loan: A Nidhi Company is not allowed to give money as personal loan. The loan has to be against any security as prescribed above.Hire Purchase: A Nidhi company can not undertake hire purchase busines
