How to Verify a Company in India? An Ultimate Guide

India is currently one of the major economies with the quickest rates of growth in the world, drawing more and more attention from foreign companies and investors. The middle-class population, over 1.4 billion people, makes India’s middle class large and growing; growth is driven by increases in disposable incomes and urbanization that bear huge impacts on businesses like consumer goods, retailing, real estate, and e-commerce. Yet, businesses still face an intimidatingly complex regulatory environment. Sector- and region-specific requirements lead to complexity in compliance when doing business.

To verify a company in India, you need to check things such as:

• Company directors, shareholders, and other important individuals
• Company details like address, contact information, etc
• Compliance with standard regulations

How to Verify if a Company is Registered in India?

For smooth operations, all companies must be registered with the Ministry of Corporate Affairs (MCA). To verify a company in India, you must see whether it is registered with MCA and compliant with state and foreign regulations. The official registry is responsible for authenticating the legal status of businesses operating across India. MCA, the official portal for business verification, administers the corporate laws and regulations that govern companies and limited liability partnerships (LLP) in India. It also maintains the portal to facilitate various business operations in coordination with technical bodies like the National Informatics Centre (NIC) and the Registrar of Companies (RoC).

Step-by-Step Guide to Verify a Company in India

To verify a company in India, you must first see whether it is registered with the MCA, and for that, follow the series of following steps:

• Open the MCA Website: To verify a company in India, open the Ministry of Corporate Affairs website, and in the ‘MCA Services’ section, select the ‘View Company/LLP Master Data.’
• Company/ LLP/ Directors/ Designated Partners: In this type of search, simply enter the company name, Limited Liability Partnership (LLP), or company’s designated partners.
• Advanced Search: For a successful search, you can also search for an organization with its registration number.
• Data Provided: By entering any of the input mentioned above parameters, you get business information, including company name, CIN, FCRN, LLPIN, FLLPIN, state in which it is located, and the current statutes of the organization.

Suggested Read: How to Check if a Company is Legally Registered?

Challenges to Verify a Company in India

The verification of registered businesses in India is subject to multiple challenges. While the data regarding the registered companies and LLPs are available on the portal, you may still face some challenges during business verification. Key challenges include:

• Login and Time Out Issue

To verify a company in India, you must check the filings and the legal documents. On the MCA portal, you will face a login issue. For example, if you do not complete your activity within a specific timeframe, your session will expire, and to continue, you will have to start all over again. These frequent session expirations are a big challenge during the Indian business verification.

• Repeated Captcha Fatigue

One of the downsides of the Indian business verification portal is that it has too many captchas. From searching for a specific business to retrieving its significant data, every step requires you to solve a mathematical addition sum, leading to frustration. This slows down the user’s interaction with the website and may eventually cause captcha fatigue.

• Technical Error

The data you are given after searching an Indian company on the MCA website has some technical issues regarding the captcha. For example, if you click on the Corporate Identification Number (CIN), a captcha appears on the screen, and even if you verify, sometimes you can not further access company data.

How to Verify Ultimate Beneficial Owners in India?

The official business registry of India does not provide any Ultimate Beneficial Ownership (UBO) information. This non-availability of information increases the legal and regulatory risks related to standard compliance. Many potential crimes, such as money laundering and terrorist financing, are likely made possible by the intricate ownership structure. This emphasizes the critical need for comprehensive solutions during third-party verification in India, especially concerning Ultimate Beneficial Owners (UBOs).

Though the MCA collects information on UBO for regulatory purposes, it does not display such data via its portal. UBO data is usually maintained by the authorities and other institutions that may need it for compliance, AML, or KYB purposes. For businesses or individuals looking for UBO information, the KYB might provide you with UBO data through manual verification.

Implementing AML Checks on Businesses in India

• Adverse Media Screening: Adverse Media Screening is a practice organizations use to identify negative news or information about individuals or entities from public sources, including media, blogs, and social platforms. Its aim is risk assessment regarding financial crimes, corruption, and reputation-threatening issues for compliance with AML regulations. The KYB is a unified platform providing integrated business checks on high-risk individuals or organizations, preventing the potential risk of financial loss and legal penalties.

• UBO Screening: UBO screening is the process of discovering the actual or beneficial owners behind any business, which is often complex. In India, it is essential to be transparent in preventing financial crimes like money laundering, financing terrorism, and tax evasion. UBO screening results in compliance with applicable laws on KYB and AML, offering various legal, reputational, and financial protection controls.

• PEP Screening: Businesses or individuals with elevated risk due to their high status as politicians or other notable figures are checked in this type of screening. To verify a business in India, you should see whether the individuals of a particular business are on the PEPs list. We at The KYB provide this type of screening to identify high-risk profiles by verifying them against the public database.

Suggested Read: Current State of Business Verification in India

Licenses and Certifications

• Reserve Bank of India

The Reserve Bank of India (RIB) is the official regulator responsible for managing the Indian banking industry. It plays an active role in combating financial crime, primarily focusing on money laundering and financing terrorism. It provides the legal framework, highlighting the acts administered by RBI. To ensure that the entities adhere to the financial rules, it also publishes a List of Returns, a comprehensive list of regulatory returns that banks and financial institutions must submit to the RBI.

• Central Board of Direct Taxes

The Central Board of Direct Taxes, CBDT, is the paramount body in the Ministry of Finance concerning the management and superintendence of direct taxes in India, which includes corporate and income taxes. The broad mandate of the CBDT is to provide the requisite input on policies, inputs about tax legislation, and maintenance of conformity with tax regulations in the country.

• National Company Law Tribunal

The NCLT is a regulatory body in India that was established to take up cases related to corporate disputes concerning insolvency, amalgamation, mismanagement, and others under the Companies Act and the Insolvency and Bankruptcy Code. It has to ensure expeditious disposal of the corporate dispute, protection of the stakeholders’ interest, and monitoring of the corporate restructuring and liquidation process. Businesses involved in corporate restructuring, insolvency, or looking for corporate governance must get a license from NCLT.

How Can The KYB Help Verify Business in India?

Avoid the hassle of navigating different sources for company verification in India. The KYB, being the best corporate data provider, aims to simplify the intricate and time-consuming business verification process. We source data directly from public registries instead of unreliable sources. To verify a company in India, you can trust us as we guarantee you that we will provide you with company data that is not only comprehensive but also up-to-date. The KYB also has global data coverage with corporate data sources from 250+ countries and states, which means that our customers get quick access to a number of primary source documents in real-time at a single click of a button.

Trust The KYB to verify any business within India and establish solid corporate partnerships with legal entities.

Suggested Read: Significance of Corporate Investigations in Protecting Business Reputation