The Advocata Institute has commended the decision taken by the Department of Census and Statistics (DCS) to launch an e-registry portal to register unregistered and registered businesses in Sri Lanka.
The Institute has called upon the Government to support this reform. This would enable thousands of entrepreneurs, unregistered micro, small and medium businesses to formalise their ventures and gain access to formal sources of finance.
Research carried out by the Advocata Institute has identified an array of regulatory barriers that discourage or hinder micro and small enterprises. An all-island survey carried out during the course of its research has identified access to finance as a critical problem. It also identified the complexity of the business registration process and related regulation as a barrier to registration.
According to the DCS, 45 percent of micro-enterprises and 10 percent of small enterprises remain unregistered in Sri Lanka, although sole proprietorships account for 63.1 percent of all businesses in the country, and account for 27.1 percent of national employment. Reforming the registration process through the proposed e-registry will help overcome the barriers faced by micro and small enterprises.
The Advocata Institute’s report titled, ‘Barriers to Micro and Small Enterprises (MSEs) in Sri Lanka’ provides a comprehensive analysis of the problems faced by these businesses. A key reform recommendation of the report is the setting up of an e-Registry.
“While commending the DCS for putting forward this timely reform, we invite all policymakers to rally behind the task of reducing the documentation and approvals needed to register a sole proprietorship or a partnership in Sri Lanka and bring the process in line with that of registering a private company,” an Advocata spokesman said.
Implementing policies that incentivise the registration of businesses would be a step towards achieving the government’s vision of empowering entrepreneurs and creating a vibrant national ecosystem for businesses.