After the idea of incorporating a company what is the basic need for start-ups? Without any doubt, reply to this would be capital. Capital becomes the foremost issue for start-ups.    I remember an instance relating to this. Few months back, an entrepreneur entered my office. In our first meeting, I could feel that person is full of energy, have lots of great ideas and highly boosted up with the feel of starting his own company. He asked me about all compliances which shall be fulfilled for incorporation. After a short discussion, when I started about the capital requirement, I saw something suspicious on his face. The moment he realised that there is a requirement of minimum capital to incorporate, all his enthusiasm was suddenly vanished. He urged to know about any options to incorporate a company with lesser capital. But as we all know that there is no such option available. This short discussion which could turn to something more ended that very moment. He left office with no zeal fervor. Like this there are many start-ups whose passion of being an entrepreneur ends up with the initial requirement of minimum capital. For all start-ups who are busy in arranging funds to be an entrepreneur shall take out time and go through this article. This may be which you are not aware of and mind it, you as a start-up must know this. We all understand that capital requirement of each business is different as per the nature of each business. Some have high capital requirement and few have low requirement of capital. However, the Companies Act, 2013, prescribed the minimum capital requirement of each company. Minimum capital requirement by Private Companies is Rs. 1lakh whereas for Public Companies it is Rs. 5lakh. Due to this clause, many start-ups whose business did not require such high capital even then they had to arrange the minimum requirement. Many a times when start-ups could not arrange the minimum capital they had to back-off from starting a company. These issues were a major hurdle for start-ups to incorporate their existence. Thus, the Companies (Amendment) Bill, 2014 has been brought so that such hindrance can be removed. One of the amendments in the said Bill is that the requirement of minimum capital has been uplifted. With coming of this amendment, start-ups are relieved from minimum capital and can now move ahead. There were many rules and forms to be filled and submitted. For instance,

• Every subscriber to the Memorandum of Association (MoA) of the private or public company shall be required to deposit minimum subscription money in the company’s bank account.
• An Indian company receiving investment from a body corporate (incorporated outside India) or foreign national or NRI/ OCI holder shall report the details of such investments to RBI and comply with rules and regulations of FEMA under Foreign Direct Investment Policy.

Now, in the amended bill, it is to be noticed whether such regulations shall still be followed or not. Above all, the good news is that the compliances regarding incorporating a company have shrink. Now, a company may be incorporated like a firm. Less of compliances means less of hurdles to emerge. So all start-ups who were not able to incorporate due to capital issue now, be ready to enter into corporate world. All existing companies shall be aware that this cup of coffee is not served for them. So, they shall not be affected by this amendment. For all start-ups this coffee is served with cream for them which they shall not miss out. So, Start-ups be ready to enter the corporate world as no minimum capital required to incorporate. For incorporating company and any further assistance, visit: https://taxmantra.com/company-registration/  __________________________________________________________________________________________