Authorised vs Paid-Up Capital
Two numbers that get confused constantly. One is a ceiling you set; the other is money that actually came in. Tender authorities and investors look at the second.
The difference in one table
| Authorised capital | Paid-up capital | |
|---|---|---|
| What it is | The maximum share capital the company may issue | The value of shares actually issued and paid for |
| Where it is set | In the memorandum | By what shareholders have actually put in |
| Can it be changed | Yes, by resolution and filing | Changes when shares are issued |
| Is it money in the company | No | Yes — it was actually paid |
| What outsiders look at | Rarely | Often — tenders, banks, investors |
A company can have authorised capital of Rs 1 crore and paid-up capital of Rs 1 lakh. That is entirely normal and it means one lakh actually came in. Quoting the authorised figure as though it were the company's capital is misleading, and anyone doing due diligence will spot it immediately.
Written 5 September 2026. Government requirements and portal behaviour change — message us to confirm before you rely on any date or figure here.
Where this matters commercially
Tenders. Eligibility conditions sometimes specify minimum paid-up capital or net worth. The authorised figure does not help you here, and a company that increased its authorised capital hoping to qualify has spent money on nothing.
Banks and investors. Both look at what was actually contributed and at net worth. Paid-up capital is part of that picture; authorised capital is not.
Issuing more shares. This is the one real constraint the authorised figure creates. You cannot issue shares beyond it, so bringing in an investor may require increasing it first — which is a resolution and a filing, and takes time you may not have mid-negotiation. See our page on increasing authorised capital.
Common questions
Related on this site
The filings and decisions that come up before and after incorporation.