Starting a finance company in India is not easy. It requires a rigamarole of legal procedures and registrations. On top of that, both the consumer and the government look at the business with eyes of suspicion because the threat of fraud and scam are genuine. So, how do you go about registering the company? Here is a short guide to it:
- Indian companies that work in the field of finance are termed Non – Banking finance companies (NBFC), most often.
- But business has the choice to register as any one of the following, too:
o Nidhi Companies
o Producer companies
o Local Finance License
o Microfinance via Section 8 route
o Trust and Societies (Credit cooperative)
- Out of these, Nidhi Companies are the most popular. To register for it, the following is required:
o Minimum capital of Rs.5 lakh which has to be increased to 10 lakhs in a year.
o A minimum of seven persons is needed out of which 3 have to directors of the firm.
o Necessary documents such as PAN Card, Photo, Identity proof (Aadhar card, Voter ID card) and Address proof (Mobile bill/ Bank statement) of shareholders. Electricity bill, NOC and Rent agreement (in case premises are registered) of the office.