navigate

Navigating The Complexity of Ownership From The Lens of Sanction By Extension

Download Whitepaper cross

Lapses in UBO Identification, Sanctions Compliance, and Corporate data

Tuesday, 30th April. 13:00 - 14:00 London Time (GMT+1)

HOST

Mark Bain

Speaker

Louie Vargas

Speaker

Michael Harris

Blogs

Current State of Business Verification in India

15 May, 2024

blog_image blog_image

India’s geostrategic location provides easy access to the key markets in Asia-Pacific, making it a centre of attention for many global investors. With over 1.4 billion people, it is the largest consumer market and attracts various businesses. This article helps develop insight into the prevailing status of business registries in India. It also aims to shed light on the adequacy and shortcomings of the existing systems for verifying businesses.

Challenges of Business Verification in India:

India faces significant challenges when it comes to business verification and corporate compliance due to a variety of reasons. A few important challenges are as follows,

  • Language Diversity:

India is a country with a diverse culture, where over 20 languages are spoken. However, this diversity creates challenges during business boardings in India. Many business documents in India exist in the complex Indian language script, requiring accurate translation during mandatory corporate compliance. Additionally, the complexity of interpreting the script and language differences can create communication hindrances that cause problems in KYB compliance.

  • Missing details about Ultimate Beneficial Owner: 

The official business registry of India does not provide any information about the beneficial owner. This lack of transparency increases the legal and regulatory risks related to KYB compliance. The intricate ownership structures often conceal ownership and create room for illicit activities. These challenges highlight the need for comprehensive solutions during business onboarding in India, especially related to identifying the ultimate beneficial owner.

  • Limited access to information: 

Another major challenge associated with business verification in India is that many businesses lack an online presence, which creates vulnerability in regulatory compliance during business onboarding. Such companies’ databases are missing from the public database, creating an issue in knowing your business in India. This lack of information poses a significant challenge for businesses, regulatory authorities, and other stakeholders who need to verify the authenticity and credibility of the companies they deal with.

Also Read: Current State of Business Verification in Japan

Primary Regulatory Bodies for Compliance:

Many regulatory bodies in India regulate business compliance to guarantee a secure marketplace. The primary regulatory bodies are listed below;

  • Ministry for Corporate Affairs:

This ministry plays a significant role in promoting a transparent business environment in India. It regulates various aspects, such as the company’s foundation, operations, and dissolution. Additionally, the ministry is responsible for issuing licenses and permits to the company to proceed in the marketplace by ensuring regulatory compliance

  • Securities and Exchange Board of India:

It ensures that investors in the marketplace get access to accurate business information before merchant onboarding. So, it provides transparency and protection for KYB compliance in India. It also monitors the marketplace to detect and address any possibilities of marketplace manipulation and fraudulent activity.

  • Reserve Bank of India:

Reserve Bank of India is the central bank in India that regulates the fiscal and banking system. It plays a crucial role in transaction record keeping, promoting transparency and efficiency in the financial sector. The RBI actively manages financial risks by conducting corporate compliance and mitigating systemic risks to ensure the stability and resilience of the economic system.

Data Score of Business Verification in India:

Data Score of Business Verification in India

Key Beneficial Ownership Information – India:

The information on the ultimate beneficial owner provided by the official business registry of India for company verification is depicted in the figure below.

Key Beneficial Ownership Information – India

How can The KYB help?

Multiple regulatory bodies govern corporate compliance in India. The KYB consolidates data from 20+ official data sources for business verification in India in one place. It also provides AML  and UBO screening solutions to enhance your knowledge of your business checks.
A list of data sources that The KYB retrieves data from is provided below.

  • International Financial Service Authority Centre: It assists The KYB during the business onboarding process by providing necessary verification data and ensuring that businesses adhere to corporate compliance standards through rigorous verification and monitoring procedures.
  • Calcutta Stock Exchange: It facilitates merchant onboarding using The KYB by verifying the credentials and compliance status of businesses participating in stock market activities.
  • Southern India Chamber of Commerce and Industry: It facilitates merchant onboarding using The KYB by verifying the credentials and compliance status of businesses participating in stock market activities.
  • National Stock Exchange of India Ltd: NSE adds to The KYB data by providing verification data and conducting due diligence to maintain the integrity of its trading platform. It ensures that listed companies comply with regulatory requirements related to financial reporting, corporate governance, and disclosure norms.

You can get in touch with our team for further information.

Read more: Current State of Business Verification in Australia

Latest Posts

17 May, 2024

.

5 Major RegTech Trends & How Companies Can Leverage Them for Benefits

15 May, 2024

.

Dirty Money in Paradise? Dubai Leaks Triggers Ownership Concerns in Real Estate Sector

15 May, 2024

.

Current State of Business Verification in India

Recent Blogs

5 Major RegTech Trends & How Companies Can Leverage Them for Benefits
Dirty Money in Paradise? Dubai Leaks Triggers Ownership Concerns in Real Estate Sector
Current State of Business Verification in France