Microfinance Company in India

Microfinance Company in India

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How to Start a Microfinance Company In India

First way:

Register a Micro Finance institution/ NBFC incorporated through RBI Rules

–       Eligibility: Must have INR 5 CR net owned fund(that is investment at the beginning)

–       Govt Fees: 11 lakhs other than professional charges of consultants

–       All microfinance companies are not entitled to accept public deposits. Only those who have approval from RBI and have an investment grade rating are allowed to accept/ hold public deposits to a limit of 1.5 times of its Net Owned Funds.

In India, there are more than 17000 NBFCs RBI is not giving permission easily to new microfinance companies. Though, if all formalities are complete and pre-conditions are satisfied, there is no reason for the RBI not to permit registration, nevertheless, the process takes a very long time at least 9 months to one year.

Second way:

Section 8 company incorporated under companies Act, 2013

–          Cannot accept deposits from public

–          Limit of loan that can be provided is: 50,000 for a business enterprise and Rs. 1,25,000 for meeting the cost of a dwelling unit to any poor person for enabling him to raise his level of income and standard of living

–          Loan to be extended without collateral.

–          Eligible borrower: Rural household with annual income not exceeding 1,00,000 or urban and semi-urban household income not exceeding 1,60,000

–          Loan amount should not be more than 60,000 in the first cycle and 1, 00,000 in subsequent cycles.

–          Total indebtedness of the borrower should not be more than 1, 00,000.

–          For loan amount more than 30,000 tenure of the loan not to be less than 24 months

–          Aggregate amount of loans, given for income generation, is not less than 50 per cent of the total loans given by the micro finance institutions

–          Loan is repayable on weekly, fortnightly or monthly installments at the choice of the borrower.

–          No RBI approval on registration or to provide loan. But must follow guidelines for interest rates and processing fees.

To Incorporate Section 8 Company

–          Minimum 2 directors required.

–          Documents Required :

PAN Card of Directors (Copy), ID Proof of Directors (Prefer Aadhaar Card), Passport size photograph of all the Directors, Residential Proof of registered office (Telephone or Mobile Bill/ Electricity or Gas Bill), Landlord NOC (we will provide the format), Bank statement/Utility bill of Director

–          Time Taken: 30-45 days



Types of Business Entities in India




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COVID-19 outbreak has not just weakened the health of humans rather it is worsening the economic growth all-round the globe. Big Corporates, MSME’s, MNC’s and the unorganised sector which are the drivers of the Indian economy are the ones worst affected. As per IMF statistics, the growth rate in Asia is likely to be stalled at 0% for the F.Y. 2020-21 which is the worst performance ever recorded in the past 60 years. Even during the times of global financial crises & Asian financial crises the growth performance of the Asian continent was 4.7% & 1.3% respectively.

How Do You Plan to Rebuild Your Business After COVID-19

Big corporates & MNC’s will revive and get their business back on track because they have various sources to generate fresh funds, which will help their business to gain momentum again. But tough times will come for MSME registrations, New company registrations & business in the unorganised sector. The only thing which differentiates between these two types of a business venture is the source of funds they possess and the management of these funds.

Having a post-lockdown strategic plan ready for your business will help to revive it from any major setbacks. If you don’t have a strategic plan for your business then it is the right time to think in that direction and revive your business from the effect of COVID-19.

Some points which we will analyze to bring your business on track:


Just as the doctor does before recommending any medicine to its patients, in the same manner, you must first diagnose the problem which your business is facing. Therefore assessment is the fundamental stage for the revival of your business. Check which area of your business is worst affected and find the best alternative solution for it.

Cost-benefit analyses of your business with the help of cash-flow statement, sources of revenue, and cost of customer acquisition will help you to maximize efficiency in the acquisition and utilization of financial resources. Consulting a chartered accountant will help you to reduce cost and save taxes.

Not just sales, revenue, profit & cash flows but also consider non-cash measures, which has affected your business such as; stock loss, customer loss, loss of goodwill in the market etc. these factors should also be factored in while computing the loses.


The economy and the market will not be the same as it used to be earlier therefore it is imperative to bring some hair-cuts in your business structure. Analysing the complete trend in your the business industry will help you to devise a competitive strategy for your business.

New company registrations
New company registrations

3.            ADDITIONAL FUNDS

Unless you have a large chunk of liquid funds in your business available, you need to figure out the sources through which you can raise the funds for your business. It is most likely that most businesses, MSME Registration, Start-ups will face a huge shortage of working capital to kick-start their business. Since we know now that it’s a the tedious process to get your business loan sanctions from financial institutions and the long duration it takes to get the funds in your hands, therefore it is advisable to get all these preparations beforehand so that when the time arrives you do not need any extra time to arrange those funds.

Various modes of funding through financial institutions are:

•             Working capital financing

•             Inventory financing

•             Fixed capital financing

•             Business lines of credit

•             Other modes of financing

Even borrowing is competitive in the market and you cannot risk your business by borrowing funds from a non-competitive source. For example; suppose you have a loan from Bank A @10% whereas your competitor is having a loan from Bank B @ 9%. Even if you have a product/service of utmost quality you will not be able to compete because your funds are borrowed at a higher rate as compared to your competitor.

Every other option has different rates of interest applicable and each option have a different set of pros & cons attached to it. Let a financial domain expert and a chartered accountant who is also a provider of CA services online, decide this for you.


“Unless you have defined time-line, you will always be lack of time”.

Prioritizing the work and setting a realistic timeline to achieve the goals is much needed in the times of COVID-19. Instead of taking the entire task, an ideal businessman should take step by step growth to achieve their business goals. Initially, your goal is to secure funds for your business and then only you can start your business operation so one must consider securing their funds as their priority.

During the initial period of COVID-19 recovery process looks at whether you are able to meet the specified timeline and check what is working in your plan and what needs modification.

5.            CONTINGENCY PLAN

This pandemic seems more like once in a lifetime event but in a business, there are certain external factors which will disrupt the smooth functioning of your business. So before any such situation arises in future a rational businessman must start to establish some safeguards to prevent their businesses from future shocks.

Such as establishing liquidity provisions, increase your online presence; clear your debt as early as possible, cutting down non-essential expenses etc. By making these changes you can not only secure your business from future crises but it will also improve your business functioning in contemporary times. Prepare your business plan A, B, C until your business future is secured.


CAonWEB have most experienced and trusted professionals on board. Our expert professionals are trained to work in a highly controlled and pressurized situation. We have a highly effective and efficient team having specialization in diverse fields and they will be interested to help your enterprise during this phase of COVID-19 crises.

Our trusted expert professionals are focused on creating value to your business by delivering you the most accurate information and the future path for your business. our experts with deep industrial knowledge brings in most developed, innovative, technology-driven solutions for the business of our clients and help them to smoothly operate their business even in the challenging times.

–          Increase adaptability against disruptive market forces.

–          Transforming your weakness into your advantage.

–          Optimizing the compliance cost of your business.

–          Analysing the company’s financial statements.

–          Establish a strategic plan for your business.

–          Preparing a contingency plan.

Source- https://www.caclubindia.com/articles/how-to-rebuild-your-business-after-covid-19-41490.asp

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Company incorporation

भारत में व्यवसाय शुरू करने के लिए कदम?

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भारत में व्यवसाय शुरू (starting a business in India) करने से पहले पहला कदम सही व्यवसाय संरचना का चयन करना है। एक सही व्यवसाय संरचना वह है जो व्यवसायी के व्यवसाय की प्रशंसा करती है। भारत में उपलब्ध व्यावसायिक संरचनाएं(business structures) इस प्रकार हैं:

  • व्यक्तिगत स्वामित्व(Sole Proprietorship)
  • साझेदारी पंजीकरण(Partnership Registration)
  • कंपनी पंजीकरण(Company Registration)
  • सीमित दायित्व भागीदारी(Limited Liability Partnership)

सबसे महत्वपूर्ण कदम होने के नाते सही व्यावसायिक संरचना का चयन करने के लिए एक पेशेवर से परामर्श करना आवश्यक है। एक प्राइवेट लिमिटेड कंपनी भारत में व्यवसाय शुरू करने के लिए सबसे अच्छी और अत्यधिक अनुशंसित व्यवसाय संरचना है। कंपनी पंजीकरण के लाभ इस प्रकार हैं:

  • अपने शेयरधारकों(shareholders) को सीमित दायित्व प्रदान करता है
  • निदेशक अलग-अलग रूप में हो सकते हैं, शेयरधारक(shareholders) यानी मालिक
  • कर लाभ(Tax benefits)
  • बैंक ऋण(loans) प्राप्त करने में आसानी
  • कानूनी मान्यता
  • शाश्वत(Perpetual) उत्तराधिकार(succession)
  • निवेशकों द्वारा पसंद किया गया

एक बार व्यवसाय संरचना(business structure) तय हो जाने के बाद अगला कदम वही पंजीकृत होना है। कंपनी का समावेश( Company incorporation) व्यवसाय का लोकप्रिय रूप है जो निम्नलिखित कंपनी पंजीकरण प्रक्रिया(Company registration process) का उल्लेख कर सकता है:

  1. अनोखा नाम(UNIQUE NAME): प्रस्तावित कंपनी(proposed Company) के लिए एक अनोखा नाम खोजने के लिए नाम पंजीकरण(registration) / अनुमोदन की आवश्यकता है। जिसके लिए कॉर्पोरेट मामलों के मंत्रालय के साथ नाम लागू करने से पहले संबंधित वर्ग में एमसीए डेटाबेस(MCA DataBase) और ट्रेडमार्क (trademark) की गहन जाँच की जानी चाहिए।
  2. डिजिटल हस्ताक्षर प्रमाण पत्र(DIGITAL SIGNATURE CERTIFICATE): डिजिटल हस्ताक्षर( digital signatures) के लिए आवेदन को सरकारी अधिकृत एजेंसियों(government authorised agencies ) के साथ दर्ज करना होगा जो प्रमाणन एजेंसियों के नियंत्रक द्वारा सत्यापित हैं। DSC कंपनी पंजीकरण प्रक्रिया(Company registration process) में प्रयुक्त पासवर्ड(password ) संरक्षित टोकन है।
  3. अगला संबंधित दस्तावेजों और रूपों को तैयार करना है जिसके लिए कोई पेशेवरों से सहायता ले सकता है या ऐसी सीए सेवाओं(Ca services) के लिए उन्हें किराए पर ले सकता है। निगमन(incorporation) प्रत्र (forms) जुड़े हुए रूप हैं जिनमें निम्नलिखित शामिल हैं:
    • फार्म नं. INC-32 (कंपनी को इलेक्ट्रॉनिक रूप से शामिल करने के लिए सरलीकृत प्रोफार्मा): जैसा कि नाम से पता चलता है कि यह एक एकीकृत रूप है जो आवेदक को निम्नलिखित फाइल करने में सक्षम करेगा:
    • कंपनी का नाम
    • निदेशक पहचान(Identification ) संख्या
    • निगमन(Incorporation ) प्रमाण पत्र
    • पैन(PAN)
    • टैन(TAN)


फार्म नं. INC-33 (e-Memorandum of Association): इस फॉर्म में कंपनी की मुख्य व्यावसायिक गतिविधि के साथ-साथ ग्राहकों के विवरण के साथ ज्ञापन यानी कंपनी के शेयरधारकों(shareholders) और अधिकृत पूंजी की राशि शामिल है।

फार्म नं. INC-34 (e-Articles of Association): बैठक आयोजित करने, शेयरों के हस्तांतरण, मतदान के अधिकार आदि के लिए सभी नियमों और विनियमों को कंपनी के लेखों में सूचीबद्ध किया गया है। इसमें कंपनी अधिनियम, 2013 के अनुसार कंपनी चलाने के लिए आवश्यक नियम शामिल हैं।

फार्म नं. INC-35 (माल और सेवा कर पहचान संख्या के लिए आवेदन, कर्मचारी का राज्य बीमा निगम पंजीकरण और कर्मचारी भविष्य निधि संगठन पंजीकरण): एक ही फॉर्म के माध्यम से GSTIN / EPFO / ESIC के लिए आवेदन कर सकते हैं।

एक बार फॉर्म दाखिल करने के बाद कंपनी की पंजीकरण प्रक्रिया(company registration process) पूरी हो जाती है।

व्यवसाय पंजीकरण(business registration) के बाद पैन(PAN ) यानी स्थायी खाता संख्या(Permanent Account Number) और टैन(TAN) यानी कर खाता संख्या(Tax Account number) प्राप्त करने की आवश्यकता होती है। दोनों को NSDL वेबसाइट के माध्यम से क्रमशः 49A और 49B फॉर्म भरकर आवेदन किया जा सकता है।

सभी व्यवसाय जहां कारोबार 20 लाख से अधिक है, उन्हें जीएसटी पंजीकरण(GST registration) लेने की आवश्यकता है। यह ई-कॉमर्स व्यवसायों के लिए भी अनिवार्य है।

पंजीकरण प्रक्रिया में लगभग 7-12 कार्य दिवस लगते हैं। व्यवसाय पंजीकरण(Business registration) एक आसान काम नहीं है इसके लिए हर कदम पर पेशेवर इंटरफ़ेस की आवश्यकता होती है।

ब्रांड पंजीकरण(Brand registration) लोगो और Brand नाम के लिए आवश्यक है। जिसके लिए ट्रेडमार्क पंजीकरण(trademark registration) के लिए आवेदन किया जा सकता है। एक बार आवेदन दायर करने के बाद TM शब्द का उपयोग लोगो के साथ किया जा सकता है और अनुमोदन के बाद R मार्क का उपयोग किया जाता है।

कंपनी पंजीकरण(Company Registration) के लिए आवश्यक दस्तावेज क्या हैं?

आवश्यक दस्तावेज़:

  • Promoters का पैन कार्ड
  • दोनों promoters के पासपोर्ट साइज फोटो
  • Promoters के आधार कार्ड / वोटर I.D.
  • दोनों प्रमोटरों का बैंक स्टेटमेंट / यूटिलिटी बिल
  • किराया समझौता(Rent agreement), यदि व्यवसाय का पंजीकृत स्थान किराए पर लिया गया आवास है
  • बिजली बिल / पानी का बिल (व्यवसाय का पंजीकृत स्थान)

Related Blog: What entities are eligible for MSME Registration & Document for MSME?

मैं भारत में घर पर एक छोटा व्यवसाय कैसे शुरू करूं? प्रारंभिक चरण में एक udyog adhaar registration or GST registration. प्राप्त करके घर पर परिचालन शुरू कर सकते हैं।

Original Source: Steps for starting a business in India?

How to register a company online in Delhi?

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A Private Limited Company is the best and highly recommended business structure to start a business in India. Online company registration in Delhi is easy to form and operate therefore being the most acceptable form of business.  Let’s have a look at the benefits of Company Incorporation:

  • Provides limited liability to its shareholders
  • The directors may be different form the shareholders i.e. owners
  • Tax benefits
  • Ease of getting bank loans
  • Legal Recognition
  • Perpetual succession
  • Preferred by investors

The private limited companies incorporated are governed by the Ministry of Corporate Affairs and to speed-up the incorporation the registration application is processed by the Central Registration Center. The steps for Private Limited Company registration in Delhi is as follows:

Important Points to be kept in mind while doing Online Company Registration In Delhi:

  • ONE PERSON COMPANY: One person company registration in Delhi, An OPC as the name suggests is a combination of benefits derived from sole proprietorship and Company form of business, it is suitable for those who want complete control over the ownership, management and operations of the company. At the initial stage one needs to decide whether they will go for a One Person Company or private limited with 2 directors and shareholders.

Related Blog – All you need to know about Company Registration as a startup

  • UNIQUE NAME: Once decided on the form of private limited company the next step is to find a unique name for the proposed Company. The name of the proposed company should not be similar with any existing company name. So a thorough check of MCA database and trademarks in the related class needs to be done before applying the name with the ministry of corporate affairs.
  1. PAN Card of the promoters
  2. Passport size photograph of both the promoters
  3. Aadhaar Card/ voter id of the promoters
  4. Bank Statement/Utility bill of both the promoters
  5. Rent agreement, if the registered place of business is a rented accommodation
  6. Electricity bill/ Water bill (registered place of business)
  7. No Objection Certificate
  • TIME TAKEN: Online Company registration in Delhi takes around 7-10 working days rest depends on the approval by the ministry.
  • PROFESSIONAL GUIDANCE: The incorporation process is not an easy task it requires a professional interface. From selecting the appropriate name in accordance with the Company (Incorporation) Rules, 2014 to the drafting of Memorandum of association and the incorporation documents, along with certification the forms professional guidance is required at every step of Company Incorporation.

To know more read: Private Limited Company

Frequently Asked Questions:

Q1. Can the Directors and shareholders be the same person?

Yes, the Shareholder can be the proposed directors of the Company.

Q2.  What is the minimum capital requirement?

There is no such requirement of minimum capital but it is always advisable for private limited companies to have at least Rs.1 lakh as authorised capital.

Q3. Is there a need for professional certification?

Yes the Incorporation forms need to be certified by Chartered Accountant/ Company Secretary/ Cost Accountant or Advocate.

Q4. What is COB?

Every company incorporated after 01.11.2018 needs to file a form for Commencement of business.

Get  Import Export Code Online on lowest cost.

Move To Accelerate “Make In India” & Boost Economy

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Total Revenue Foregone: INR 1, 45,000 cr. per year.

All these announcements will be applicable from 01.04.2019 (Current FY) any advance tax paid will be adjusted.

Income tax act has been amended to promote growth & investment wef F.Y. 2019-20 which allows any domestic co. to pay income tax @ 22%

Condition: They will not avail any exemption or incentives
Effective tax rate is 25.17% {incl. of all surcharges}
Minimum Alternate Tax {MAT} Not applicable

To attract fresh investment and boost to make in India another provision is added to Income Tax act: New co. incorporated on or after 01/10/2019 getting fresh investment in manufacturing pay income tax @15%.

Condition: They will not avail any exemption or incentives
Effective tax rate 17.01% {incl. of all surcharges}.
Minimum Alternate Tax {MAT} Not applicable

A co. which doesn’t opt for concessional tax regime and avails tax exemption shall continue to pay at pre amended rate.
However, these co. can opt for concessional tax regime after expiry of tax period.

Related Blog – All you need to know about Company Registration as a startup

Minimum Alternate Tax (MAT): Reduced from existing 18.5% to 15%.

Stabilise flow of funds in capital market: Enhanced surcharges introduced in finance act (II) 2019 shall not apply on capital gains arising on sale of equity share in a co./business/trust liable for Securities Transaction Tax {STT}.

Expand scope of CSR: 2% spending can be spent on incubators funded by centre/state government/PSU/contribution to IIT, National labs, all under ICAR, DRDO etc. engaged in research science/research comes under CSR


Current corporate tax rate is 30% (incl. surcharge/cess 34%) brought down to 22% (incl. surcharge/cess 25.17%) i.e. around 9 basis point effective relief in tax for current corporations.

New manufacturing: 25% (incl. surcharge/cess 29.12%) brought to 15% (incl. surcharge/cess 17.01%) 12 basis point effective relief in tax for new manufacturers. This will certainly give a boost to new manufacturers to establish their manufacturing units in India and achieve the goal of “Make in India” a reality.

Q. What impact this decision would have on the corporate sector?

  • Promote “Make in India
  • Making India an Investment hub
  • Boost Indian economy
  • Employment generation
  • More Transparent structure
  • Wealth creation
  • Export led manufacturing
  • Multiplier affect
  • Long term transition period
  • Companies cash flows will improve

Q. How to get the complete benefit of this corporate tax restructuring?

If you have an existing company or you want to establish a new company, we provide “One Stop Solution” to all your problems.

To grab this opportunity and bring the benefits of this tax restructuring in your business, feel free to reach out. Get your Company Registration in a hassle free way with our financial expert in your area who will guide you in all your finance related matters.