Kingsley Osaretin, Benin City
Answer: It is very common that many people start businesses but do not register business names.
A 2016 survey by the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) found that out of the 37 million Micro, Small and Medium Enterprises (MSMEs) in Nigeria, less than five million were registered with the Corporate Affairs Commission; meaning that 95 percent operate in the informal sector.
It is trite to say that one of the things that qualifies you to be considered a Business Owner is that you own a business. And, legally speaking, your business does not exist in the eye of the law unless, and until, it is registered under the Law.
While an un-registered business may be doing business, so to say, its scope of operation will be severely limited. For one, it cannot procure big contracts from big companies or government entities, and will continue to act like a petty trader.
Some of the advantages of operating as a registered business include but are not limited to:
- Being able to open a Corporate Account which gives it a unique identity and enables its clients to pay it with cheques.
- Enabling it to apply for and access loans through government programmes or other lending sources.
You will find the requirements for company registration at the Corporate Affairs Commission (CAC) website. Visit new.cac.gov.ng. You may wish to talk with a Lawyer to assist you with the registration process.