Registration of new firms hits an all-time high
Registration of new firms in Bangladesh rose to an all-time high of 11,110 in the last fiscal year, highlighting the expansion of business activities and people's enthusiasm about setting up fresh ventures, official figures showed.
The figure is 24.32 per cent higher from the fiscal year of 2018-19, when 8,936 registrations were taken, according to data from the Office of the Registrar of Joint Stock Companies and Firms (RJSC).
"The economic activities hampered for a few months because of the coronavirus pandemic are now picking up," said Md Mokbul Hossain, registrar of the RJSC.
The office of the RJSC is mandated to provide name clearances and registration to all public companies, private companies, liaison offices or branches of foreign companies, trade organisations, societies and partnership firms in Bangladesh.
Registration obtained for setting up new companies rose 50 per cent to 9,010 in FY20 from 6,945 a year ago. Some 250 registrations were taken to establish societies and 1,827 for partnership firms, respectively up from 229 and 1,740 a year ago.
In the first two months of the current fiscal year, 2,279 registrations were obtained from the RJSC, including 1,892 for companies, 45 for societies and 228 for partnership firms.
Some 245,655 registrations were secured from the RJSC so far. They include 3,532 for public limited companies, 175,932 for private limited companies, 932 for foreign firms, 49,180 for partnership firms, 1,121 for trade bodies and 14,958 for societies.
"The prospective entrepreneurs have to take initiatives, make some investments and go through procedures to start new businesses. With this, they have shown credible interest. So, it is a more meaningful data," said Zahid Hussain, a former lead economist of the World Bank's Dhaka office.
"It also needs to be seen whether all the proposed ventures are set up finally," he said.
The office of the RJSC is the first fully automated office among all government offices in Bangladesh, Mokbul Hossain said.
"All services are provided online."
Service-seekers do not need to come to the RJSC to secure registration. They have to apply online and pay fees online. The name clearance is auto-generated.
After getting the name clearance, companies have to apply for registration and submit the required documents. The registration is given within four hours, which used to take a month in the past. It is also given electronically, said Hossain, also an additional secretary.
Payments to the RJSC can be made through debit and credit cards. The agency is also working to allow payment through mobile financial services.
But the office is yet to be fully paperless. Hard copies of some documents are still accepted.
Copies such as balance sheets, audit reports, share transfers documents, and copies of the annual general meetings have to be submitted in hard-copy forms.
"When you have a file containing 50 pages, it is better to examine and scrutinise them using hardcopies," Hossain said.
To store documents as per the Companies Act, some hard copies also need to be obtained.
"We have detailed plans to digitalise all services," Hossain said.
He said while transferring shares, people do need to come to visit RJSC offices. Once the digital signature is in place, people will not need to do that. People even can do that anywhere in the world.
The RJSC is now working to introduce digital signatures for service-seekers. "This would allow the agency to scrutinise documents speedily and help establish a paperless office," Hossain said.
Last year, the agency signed agreements with the Bangladesh Investment Development Authority, the Bangladesh Economic Zones Authority, the Bangladesh Export Processing Zones Authority, and the Bangladesh Hi-tech Park Authority to share information and verify information through a one-stop service and put in place data integration.
A data centre and a data recovery centre should be established as soon as possible to keep electronic records, Hossain said.
It also issues certified companies of files and records. Companies need to secure permission from the agency if they want to wind up operations.