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Legopedia

How to Start an E-Commerce Business in India?

What is E-commerce?

Electronic Commerce is exchanging or encouraging the exchange of items or administrations through different pathways or gateways, for example, the Internet.

The minimum requirement for setting up an e-commerce business:

A minimum of INR 50000-100000 is required.

Before looking further on the required documents, it is necessary to think about the following-

  1.     The product that one wants to sell
  2.    Name of the organization by which it will be known

Process of opening an e-commerce business in India-

  1. Structure your business

As an E-Commerce business, there are 4 alternatives to enrol your firm from. This is-

  • Proprietorship firm enlistment – It is the easiest type of enrolment which requires the easiest process of GST.
  • Partnership firm enrolment- This type requires a minimum of 2 people with boundless obligations.
  • Private Limited Company-It is the most prominent business shape and is majorly adopted by people.
  • LLP (Limited Liability Partnership) – It is a blend of Pvt Ltd Company and Partnership firm and has many advantages.

In the wake of choosing the Structure of business one may now look forward to the other important processes required.

1. Registration of the Domain name

To achieve the security for the space name under the Intellectual Property Rights, one has to pick a one of a kind name. The name must be unique and the individual trademark of the company. It should be registered so that no other business person can take up that name in the future.

2. Prepare a protection agreement

Achieving an all-around drafted protection arrangement is an unquestionable requirement for each E-trade gateway to keep itself from being sued under Section 43A of the Information Technology Act, 2000 where punishment can reach up to 5 crores. Therefore do not forget to prepare a deed regarding the same.

3. Draft the Website’s Terms and Conditions

For any site to work, it is exceptionally important to draft the terms and conditions which would generally cover all the client agreements and friends’ contracts with a specific end goal to confine the risk of E-business site.

4. Make a Vendor’s Agreement

There should be an agreement for a merchant with all the characterized provisions and terms to manage issues to like the default in items, late delivery, and quality issues and so on. Numerous different arrangements that can be incorporated in the agreement must be added remembering the plan of action.

5. Payment portal and Logistics for E-trade business

In India, we fundamentally have 2 sorts of Payment Gateways:-

  • With no setup expenses, example pays money, PayPal, etc.
  • With set up expenses which make it easier to have faster processing example pay etc. 
  1. User understanding and Data Security

One must not forget about cybersecurity. Generally, organizations don’t feel any centrality to put resources into Cyber Security at the start of their business. However, in the wake of maintaining the business for quite a while and confronting the upsides and downsides of online business, in the end, it is important to keep in mind the cyber-related issues and be prepared for the same. Aside from this, a User Agreement likewise should be drafted in such a way and to the point that it turns out to be valuable both for the client and online business organization. It ought to have the capacity to save the client rights and limit the E-trade entry as it fills in as an Intermediary.

The documents that are required to be submitted for getting access to the opening of the e-commerce website are-

  • Bank record for the sake of the business
  • PAN Card of the business owners
  • Certificate of Incorporation
  • Memorandum of Association
  • Articles of Association
  • Identity Proof
  • Address Proof
  • Website Terms of Use
  • Website Privacy Policy

Law-related documents to begin E-Commerce business in India

  • Keep all the incorporation documents steady
  • Register for GST
  • Enter into MOU or other contracts
  • Comply with RBI rules

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by Lovina Malhotra

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