1. Member-Owned: Nidhi Companies are mutually beneficial societies, meaning they are owned by their members who are also depositors and borrowers. Each member has an equal say in the management and decision-making processes.

2. Limited Liability: Members of Nidhi Companies enjoy limited liability, meaning their liability is restricted to the amount of shares they hold. Personal assets of members are generally protected from the company’s debts and liabilities.

3. Thrift and Savings: The primary objective of a Nidhi Company is to promote thrift and savings habits among its members. Members pool their savings, which are then utilized to provide loans to members for various purposes such as housing, education, or business.

4. Deposit and Loan Activities: Nidhi Companies accept deposits from their members and provide loans to them against the security of movable assets like gold, silver, or jewelry. However, they cannot accept deposits or provide loans to the general public.

5. Minimum Requirements: To qualify as a Nidhi Company, certain minimum requirements must be met, including having at least 200 members, a minimum net owned fund of Rs. 10 lakhs, and compliance with other regulatory requirements.

6. No External Funding: Nidhi Companies are not allowed to issue preference shares, debentures, or any other debt instrument, nor can they accept deposits or loans from sources other than their members.

7. Limited Regulatory Oversight: While Nidhi Companies are regulated by the Ministry of Corporate Affairs, they are subject to lighter regulation compared to traditional banks or other financial institutions. However, they must comply with the Nidhi Rules, 2014, and file periodic reports with the government.

8. Limited Scope of Activities: Nidhi Companies are restricted in the scope of their activities and cannot engage in activities such as trading, manufacturing, or providing professional services. Their primary focus is on promoting savings and providing credit facilities to their members.