1. Relief on the NCR admin and time wait
Good day everyone, I hope you’re all well rested and ready for a power filled year. There’s no better time to start off the year with a bang than right at the beginning. Lets talk all things NCR shelf company and how it benefits you.
Having a NCR license (National Credit Regulator) has now become a strong requirement when venturing in some industries. These could include cash loans, vehicle finance for dealerships, pawn broking and much more.
The registration process can be quite stringent with all the requirements necessary to get an approval not to mention the completion of the application form which also needs careful attention. It now takes longer to get an approval, the normal standard time could be between 2 and a half months to 3 months.
A new NCR shelf company is already registered and it mitigates the long stringent requirements and the long wait. Upon purchasing the company, the only process is to do a director change for the company take over, however a criminal clearance test result will also be required in order to do the updates of the new director with the regulator,
2. Beginning the history of the company from the get go
While it is always an added advantage to purchase an older or aged shelf company, when venturing into the finance space especially as a new player, it is more beneficial to start with a new company or a 2023 if you must.
The financial standing of these aged shelf companies should be meticulously scrutinized before purchasing. Most companies would have been operating on loans themselves and having to sell them would only be because they are struggling to keep up while sitting with debts to pay and this is not often disclosed at the time of sale.
When buying a newly registered company, it gives you the piece of mind that you are operating the business from scratch and therefore will not be hit with major surprises of debts on the company or perhaps SARS debts that you are unaware of as the new director
3. Isolating your business to focus purely on cash loans
It is now normal business practice for entrepreneurs to purchase shelf companies to focus on a specific type of venture while isolating those activities from other businesses that they are running.
This reduces the confusion financially when it comes to being audited or when having to do financial statements. It is a requirement with the regulator that every year a credit provider has to provide the financial statements for that year together with annual reports in order for them to ascertain the growth, policies and fitness of operation related to the business.
Purchasing a shelf company and focusing it purely on the credit provider business will require that the company has its own bank account and is strictly only focused on the financial service the business is offering.
4. Immediate trading
Everybody knows that it takes months to obtain the NCR certificate and the wait can be frustrating leading to a waste in business opportunity.
When purchasing a shelf company you are basically beating the queue of applications that the regulator sits with. You are able to trade immediately after the director changes are done and the updates being sent to NCR. Director changes with the new CIPC process takes less that 15 minutes beause of the newly introduced OTP system.
5. Compliance ease
Owning a NCR license requires that you do annually submissions of financial statements and reports. This requires the services of a compliance officer and accountant.
Combining these services would be costly not to mention the time it takes to access contracts. Maintaining the license requires that all contracts (loan contracts) be above board with all the necessary requirements.
Our services stretch way beyond the sale of the shelf company, but to also assist with this compliance requirement every year. The cost of the service is manageable and we asssit with any or all loopholes that require room for improvement o keep your business up to par with compliance.
I hope this blog helps you when deciding on venturing into this space, please feel free to contact me for any further information by CLICKING HERE
