Surge in number of new firms being set up in 2024-25

NEW DELHI: The number of new company and LLP (limited liability partnership) incorporations increased by nearly 5 per cent so far during the current financial year to touch the 91,578 mark compared to 87,379 in the same four-month period last year, according to Ministry of Corporate Affairs.

The growth in new companies being set up during the current financial year (2024-25) comes on the back of a 15 per cent surge in new firms incorporated in 2023-24 as compared to 1.59 lakh companies registered in 2022-23. The continuous growth reflects an improvement in the business climate of the country, a senior official said.

At the end of March 2024, India had a total of 26,63,016 companies that were registered. There were also a total of 5,164 foreign companies registered in the country indicating the flow of FDI into the fast-growing economy.

The MCA data also shows that the number of DIR-3 KYC forms filed so far during the current financial year jumped to 10.17 lakh from 7.98 lakh in the same period of 2023-24.

Currently, every director who has been allocated a Director Identification Number (DIN) on or before the end of the financial year and whose DIN has been approved should file form DIR-3 KYC before September 30 of the following financial year. Annual Filing of DIR-3 KYC is also mandatory for all existing directors with DIN.

The total number of forms filed with the MCA-21 portal during the current financial year has also surged to 27.60 lakh from 23.70 lakh in the previous year.

MCA has in recent years been focused on reducing compliance burden and improving ease of doing business.

According to officials, the number of new businesses is expected to surge further with the incentive schemes that have been launched in the Budget 2024-25 for micro small and medium enterprises (MSMEs).

Finance Minister Nirmala Sitharaman announced term loans for MSMEs for the purchase of machinery and equipment without collateral and guarantee as part of a new scheme. This guarantee fund will provide guarantees of up to Rs 100 crore.

She also said that employers would be reimbursed up to Rs 3,000 per month for two years towards EPFO contributions for each additional employee. This initiative aims to incentivise the additional employment of 50 lakh people.

Besides, the Finance Minister announced employment-linked skilling through schemes as part of the PM's package. First-timers will receive one month's wage upon entering the workforce in all formal sectors. A direct benefit transfer (DBT) of one month's salary, up to Rs 15,000, will be provided in three instalments.