The number of registered small businesses in India has more than quadrupled since 2006, driven partly by the introduction of an online portal in 2015,
Figures provided by India's Udyog Aadhaar Memorandum portal show that registrations have grown from 1.5 million firms in 2006 to 6.8 million as of this year.
Though registered firms continue to account for a small fraction of India's firms, they have grown from about 4% of all SMEs in 2006, to about 13% of the estimated 51 million firms, contained in the ministry's latest annual report.
In an interview this week with The Times of India, Small Business Minister Kalraj Mishra said the portal allows an entrepreneur to enter all relevant information online.
“You click on it and within five minutes you can get your registration without any documentation and with self-certification.”
Previously to register as a MSME entrepreneurs had to complete various manual forms.
He said while between 2006 and 2015, almost 2.2 million companies were registered in India under the old Entrepreneur Memorandum, since September 2015 alone over 3 million new registrations have been carried out online.
Mishra said of the ministry’s estimate of 50 million companies, less than 10 million are registered. “The unregistered ones still pay sales tax so we can estimate their size,” he added.
The Indian government is seeking to use the power of the internet to boost SME support in other ways too.
Last month the government launched a mobile app (MyMSME) for tracking data from business-related schemes and a to monitor delayed payments to small businesses from public sector undertakings (Micro and Small Facilitation Council portal).
While technology can help firms to bypass reams of red tape, India must still do much more to incentivise tens millions more firms to register.
The government is hoping more firms will register on the portal - as registration enable firms to to access the many support and finance schemes that the state offers SMEs.
A harder job is to make it easier to do business by cleaning up the corruption and paperwork (which Prime Minister Narendra Modi is trying to tackle) that discourage entrepreneurs from registering their firms. In this India has a long way to go still.
Timm is a South African who writes on small business. Follow Small Business Insight on Twitter at @Smallbinsight.
Stephen Timm is a