Rapid Corporate Growth - Issues Limited number of MCA offices and manpower against rapid growth of companies Long, unmanageable queues Slow manual collection & verification process Payment options limited Paper sorting, storing/retrieval are very cumbersome, time-consuming and error prone Information availability to stakeholder is time consuming and error prone Inadequate compliance monitoring Quality deterioration in delivery of 5 services
Advent of MCA21 on 3 propositions 1. e-Governance is not about ‘e’ … but about Governance 2. e- Governance is not computerization … it is the transformation of the way Government serves its citizens & businesses 3. e-Governance involves adoption of a holistic approach to provide services MCA21 is designed to be a true e-Governance project in all respects 6
Business Drivers – the need for MCA21Ever-increasing corporates Physical Presence Limited Payment Options• More than 700,000 corporates • Payments were to be made • Millions of corporate representatives in person• About 6 crore pages maintained in files visit ROC office every year • Only cash or Demand Draft• One lakh charge registrations per year • Physical presence of company accepted not even cheque representative required for all transactionsLimited Access Points Long Queues Record Rooms Maintained Manually• Mostly one office per state • Slow manual collection and• Ever-increasing stakeholder base verification process • Information availability to • Unmanageable situation during peak stakeholders was time filing season of Oct-Nov-Dec consuming and inaccurate Paper Based Transactions • Paper overload doesnt permit other value added service 7 • Paper sorting, storage and retrieval was very cumbersome and time consuming
Project Objectives and Realization1. Business – enabled to register a company Nature of Service Prior to MCA21 After MCA21 and file statutory documents quickly and easily Name Approval 7 days 1 day2. Public – to get easy access to records and Company incorporations 15 days 1-3 days get their grievances redressed effectively3. Professionals - to be able to offer efficient BS / AR Filing 60 days Instantaneous services to their clients Change in directors 60 days 3 days4. Financial Institutions – to find registration Inspection of public Visit to ROC Online and verification of charges easy documents5. MCA – to ensure proactive & effective compliance and corporate governance • Revenue Increase from 700 to 1200+ Cr6. Employees - enabled to deliver best of • ZERO Revenue Leakage services • National Charge Database EstablishedFacilities for On-line end-end interaction with • Used by all Banks & FIs before loan MCA services on portal disbursal to companiesProvides Any Time, Any Where access to MCA • Automation of all Internal Functions services on a 24X7 basis • Transaction-wise Payment Reconciliation 9
MCA21-Features • Anytime Anywhere services (24*7*365) enabled • Automated pre-scrutiny of e-forms • Verification of credentials of the authorised signatory (DSC and role check) • Convenient multiple modes of payment (Credit cards, Internet banking and physical challans) • FIFO based, electronic workflow driven, paperless Back office • Electronic record maintenance preventing quality deterioration • Institutional arrangement for Project Management and public interface (PMU) • Defined performance metrics for Service Level maintenance • Contractual enforcement of service levels, including a system of incentives and penalties as part of the commercial terms 10
Milestones Sep, 2002: Project concept initiated Oct, 2003: Bidding process initiated Feb, 2004: Formal issue of RFP Document Feb, 2005: Cabinet Approval Mar, 2005: TCS Contract Signed Feb, 2006: Coimbatore pilot launched Mar, 2006: Delhi pilot launched Jul, 2006: Completed Nationwide rollout Sep, 2006: e-Filing mandated Jan, 2007: Scanning/digitization completed Jan, 2007: Provisional certification Accorded 11
Visible Achievements Procedural uniformity across all offices Speed and certainty of service delivery, with ease of access Transparency – status of processing of filings and approvals Problem of malpractices inherent with a paper-based system addressed (such as ante-date filings, incomplete filings, replacing documents, etc.) Establishment of a dependable data for effective compliance management Platform for further processes refinement (e.g. central registry) Empowerment of the citizen/investor with authentic data about companies through the Internet Introduced e-stamping from 13th Sept 2009 making incorporation completely paperless 12
Recent Improvements (2009-10)E-Stamping:Introduced E-Stamp from September 2009 as secure, fast and cleansystem of stamp duty collectionJoint initiative – MCA, States/ UT and BanksDispensed with effort and cost to physically visit the treasury andsaved timeA prominent Green initiative in MCA21 leading to reduction in paperusage to the extent of 40 lakh pages so farEmerged as a Model program for replicationNew e-Form for rectification of error:Introduced new e-form (Form-68) in Mar’10; enables corporate torectify mistakes in Incorporation documents through electronic 13process.
Recent Improvements (cont..) “Company Law Settlement Scheme, 2010” gives opportunity to the defaulting Companies to enable them to make their default good by filing belated documents and to become a regular compliant in future. “Easy Exit Scheme, 2010” and “Easy Exit Scheme, 2010” gives opportunity to the defunct companies to get their names struck off from the register under Section 560 of the Companies Act, 1956. The EES 2011 was closed on 30.04.2011. Total 36 thousand companies has applied for struck off under section 560 of the companies Act, 1956 in both the schemes. 14
Recent Improvements (cont..) Trouble free Peak Filing: •October and November each year are the peak filing season for Balance Sheets and Annual Reports •The Ministry set in motion advance readiness action plan – • software optimization • hardware augmentation • appeal to corporates to stagger filings through media campaigns, portal message etc. •More than 12.87 lakh filings were received in the months of Oct & Nov without any hindrance which is 20% more than last year •An all time high of 70,000 filings was recorded on 29th Oct 2010 that includes 22,000 balance sheets. Integration with other regulators: End-to-end integration with Trademarks Authority through NSDG for informed regulation is nearing completion. 15
Recent Improvements (cont..) DIN process re-engineering Application for DIN is being made on eForm and there is no need for submitting documents physically scanned documents along with verification by the applicant will be attached with the eForm and if the eForm is digitally signed by professional or by MD / Director / Secretary of the existing company, DIN shall be granted online. This will reduce the time taken for allotment of DIN from 7-10 days to 1-2 days.
Recent Improvements (cont..) Challan Payment is not allowed for payment upto Rs.50000/- From 2, 3, 18, 32 are made as STP (State through put process) w.e.f. 01.05.2011 and eForms are to be added in this category. This will reduce the ROC workload by around 40%.
Recent Improvements (cont..) Introduction of refund Process There is no refund process in MCA21 for refund of fee wrongly paid by the user till recent. Now w.e.f.01.05.2011 the MCA has allowed refund by way of filing a new refund eForm for cases of Multiple payments, incorrect payment or excess payments.
Operational Statistics (as on 31.01.2011) Average portal hits/ pages viewed per day – 40 lac/ 5 lac Total filings through the system – 126.76 lac Peak filing on a single day (on 29.10.2010) – 70,034 Number of companies registered online – 3.42 lac Company records viewed online – 15.58 lac Total DIN issued – 20.02 lac Number of E-stamp transactions – 1.65 lac Amount of E-Stamp collected – Rs. 25837 lac E-filing through VFO (Virtual Front Office) – 93% Online payment transactions (by volume) – 64% Revenue collection multiplied three fold 19
Impact on Service delivery efficiencies Nature of Service Prior to MCA21 After MCA21 Name Approval: 7 days 1-2 days Company Incorporation: 15 days 1-3 days Change of Name: 15 days 3 days Charge Regn./ Modification: 10-15 days 2 days Certified Copy: 10 days 2 days Registration of Other Documents Annual Return 60 days Instantaneous Balance-sheet 60 days -do- Change in Directors 60 days 1-3 days Change in Regd. Office Add. 60 days 1-3 days Increase in Auth. Capital 60 days 1-3 days Inspection of Public Documents On-line 20 Focus on delivery of all business critical services in 48 – 72 hours
Regulatory efficiency Easily accessible disclosures of corporate processes and decisions Speedy and more effective enforcement action including scrutiny and inspections without harassment. Analysis of financial information of companies to detect accounting and disclosure compliance Easy to access registry of charges providing critical credit information about the company. Analysis of company data to develop risk management systems to detect abnormalities in financial information filed by companies and assessment of possibility of fraud. 21
MCA21 – Best Practices in e-Governance ‘Blue print’ Approach – RFP Document Holistic outsourcing – PPP viability Digitization of legacy – assembly line approach RFO – Addressing Digital Divide DSC – largest usage worldwide Back office workflow – productivity management Gateway – simplifying interoperability Green project – eForm & eStamp (paper elimination) 22
Recognitions Golden Icon’ in 11th National e-Governance Conference 2008 Dataquest IT Path Breaker Award 2006 “Skoch Challenger Award 2008” ‘Certificate of Excellence’ at Technology Sabha, 2008 Recognized as “a revolutionary step by the Government” in a survey conducted by Ernst & Young Prime Minister Award for Excellence of Public Administration – 2009 The World Bank in its report has acclaimed E- stamping initiative of the Ministry as one of the significant achievement globally. 23
Current Issues Finalisation of Exit Management Plan Changing role of PMU Formation of SPV Government Secure Repository (GSR) 24
The Way Ahead Integration with the other regulators - Income Tax, Trade Mark Expansion to new services – LLP, OL Early alerts – aid in prevention of corporate frauds Data Mining XBRL for annual statutory filing 25