Micro, Small and Medium Enterprises (MSME)
What is MSME?
The Ministry of Micro, Small and Medium Enterprises, broadly known as MSME, is the premier Government body that deals with the formulations and management of rules, guidelines, and laws pertaining to small scale industries in India.
Micro, Small and Medium Enterprises (MSME) sector has emerged as a highly vibrant and dynamic sector of the Indian economy over the last five decades. MSMEs not only play crucial role in providing large employment opportunities at comparatively lower capital cost than large industries but also help in industrialization of rural & backward areas.
In India MSME is governed by the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 In accordance with which, the enterprises are classified into two divisions. i.e.
- Manufacturing enterprises – engaged in the manufacturing or production of goods in any industry and,
- Service enterprises – engaged in providing or rendering services.The Act provides Definition based on Investment in Plant & Machinery/equipment and Annual Turnover as follows
The Act provides Definition based on Investment in Plant & Machinery/equipment and Annual Turnover as follows:
MSME registration, i.e., Udyog Aadhaar Registration has been replaced with Udyam Registration. If any micro, small and medium industries want to start any business, they can obtain the MSME/Udyam Registration.
BENEFIT OF OBTAINIG MSME/UDYAM REGISTRATION– The MSME/Udyam registration is completely online. This registration provides the business with a lot of benefits and subsidies which are as follows:
- MSME registration holders have easy access to loans with low interest rate.
- MSME registration holders can use Udyam Registration Portal to get access to Government e-Marketplace and e-tenders.
- Central or state government departments have been mandated to extend priority treatment to MSME while procuring goods or services for the consumption of goods or services for public purposes.
- MSME registered under the MSMED Act, 2006 is eligible for many tax incentives and exemption both under the Direct Taxes and Indirect Taxes including GST such as capital gain subsidy schemes under income tax act.
- Under the current laws, MSMEs registered with the MSME ministry stand to benefit from a 50% subsidy on their patent registration fees
- Businesses that have been registered as MSMEs are eligible for subsidies for Industrial Promotion as provided by the Government.
- MSME registration holders becomes eligible to many Govt schemes.
- Fill Application Form: At the first step, you must fill in basic details in the MSME Registration form that will include all the necessary details of your business such as company name, registration number, GST number, and so on.
- Enter Personal Details: At this stage, you are required to fill in all your personal details such as name, address, PAN Card, bank account details, and some common information that is mandatory during the MSME registration process. Also, a photo needs to be uploaded. Ensure that the size of the photo is within the permissible limits for it to be uploaded on the site.
- Executive Will Process Application At this process, an MSME executive will review your application. In case of any discrepancy, you will be notified about the process and make the relevant changes.
- Receive Certificate of Mail After filling the complete form you will get the certificate for MSME Registration. To know how it would be, you can download a copy of the Sample MSME Certificate. The Ministry will not issue you any hard copy for it. You will get a virtual certificate for MSME Registration.
- Aadhar number of the applicant
- Name, gender, PAN number, email id, and mobile number of the applicant.
- PAN, location, and address of the organization.
- The number of employees and the date, you are planning to start your business.
- Bank account number and IFSC code
- The basic business activity of the enterprise
- NIC 2-digit code
- Investment in plant and machinery/equipment
- MOA and AOA
- Copies of Sales Bill and Purchase Bill