Benefits of registering a business with the Corporate Affairs Commission
Anyone can decide one day to start operating a business. All that the person needs to do is provide a product or service to another person in exchange for money or money’s worth to be “in business.” While registering your business with the” Corporate Affairs Commission” (CAC) isn’t necessarily required to complete certain business transactions, it is a smart choice for new and existing entrepreneurs for a variety of reasons which includes:
1.Opening Business Bank Accounts
You need to provide proof that your business is properly registered with the Corporate Affairs Commission (CAC) to open a business bank account in Nigeria. A business bank account is an important asset to a small business because you can separate your personal activities from your business activities. It is also more professional to give your clients / customers a business account details that carry your business name for payment instead of your own full name.
2. Safeguarding Your Business / Corporate Name
One huge advantage of registration with the Corporate Affairs Commission (CAC) is safeguarding your business name from being used by another person / business. No one else can register a business with that same name or a similar name.
3. Legal Liability Protection
Another benefit of registration is receiving some legal liability protection (note that a private company limited by share has a legal personality distinct from that of its subscribers). If you register or incorporate your business, you will not be held personally responsible for certain accidents and other liabilities incurred by the registered company.
4. Getting Loans
when you apply for business loans, you’re going to have to prove that you’re actually a business. Banks and investors will ask to see your business registration certificate along with other application requirements before approving your loan application.
5. Reputation with Customers
Customers and clients, especially people you’ve never worked with before, need assurance that you are a legitimate business. A potential client may suspect your business of being a “fly-by-night” operation if your company isn’t properly registered. When a business is registered with the Corporate Affairs Commission (CAC), it could put your clients at ease when making a decision about whether to spend money with / transact business with your company.
6. Supplier Arrangements / Government Contracts
A registered business also makes you eligible to receive supplier discounts that you wouldn’t normally receive as an unregistered business entity. Suppliers usually reserve special rates for business owners who can show official evidence of business name or company registration (certificate of incorporation) issued by the Corporate Affairs Commission (CAC). Also, if your plan is to be getting government contracts for your company, a business registration is one of the first requirements.
7. Perpetual Succession / Continuity
A final benefit of registration is the business continuing even if you die or become ill. A registered business is an entity in its own right; thus, another can assume ownership or control or your business can be sold. Neither is it possible without registration.
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