Informal enterprises
https://metadata.ilo.org/taxonomy/909
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- An informal sector enterprise satisfies the following criteria:
• It is an unincorporated enterprise, which means that:
• It is not constituted as a legal entity separate from its owners, and
• It is owned and controlled by one or more members of one or more households, and
• It is not a quasi-corporation (it does not have a complete set of accounts, including balance sheets);
• It is a market enterprise: this means that it sells at least some of the goods or services it produces. It therefore excludes households employing paid domestic workers;
• And at least one of the following criteria:
• The number of persons engaged / employees / employees employed on a continuous basis, is below a threshold determined by the country
• The enterprise is not registered
• The employees of the enterprise are not registered.
Source: ILOSTAT, Indicator description (Accessed 17Nov2020)
- Informal enterprises are those firms that are not registered with the required authorities including tax, labour and social security, have weak management practices, do not operate separate bank accounts for enterprise and personal use and are by and large excluded from the formal markets including public procurement, and business networks and associations.
Source: Role of finance in driving formalization of informal enterprises, p.4, ILO, 2016)
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