Micro, small, and medium enterprises in India can register with the government to avail of multiple benefits and government schemes. When the registration is complete, you get a certificate known as the MSME Certificate or Udyam Certificate.
The MSME Certificate proves that you are a registered small-scale business in India and thus eligible for all associated government benefits.
Registering in MSME in India is not mandatory, but you should do it for multiple reasons. MSME registration comes with benefits in business finance, loans, credit eligibilities, and taxation.
BENEFITS OF MSME REGISTRATION
Collateral-Free Bank Loans
The indian government has made collateral-free financing available to all small and microbusiness sectors. this program offers financial assurances to micro and small businesses. both new and old businesses are eligible to benefit from this program. the government of india, SIDBI (small industries development bank of india), and the ministry of micro, small and medium enterprise introduced a trust called the credit guarantee trust fund scheme. this scheme (credit guarantee scheme) is implemented for all micro and small enterprises.
Access To International Trade
The indian government funds business delegations to attend international trade shows, exhibitions, business meetings and seminars, and conferences held worldwide to share expertise. this international cooperation program enables exposure to industrialization's more recent facet.
Reduced Rate Of Interest From Banks
MSME-registered business benefits from a lower interest rate compared to other enterprises. for the MSME sector, priority credit has been maintained. since bank lending to MSMEs has reached a certain threshold, they benefit from cheap business loan interest rates. within the next two years, credit to micro and small firms must rise by 20%. a 10%annual growth rate in micro businesses is seen. the bank's total lending must be distributed to the MSME sector at a minimum of 60%.
Subsidy On Patent Registration
According to existing regulations, MSMEs registered with the MSME ministry are eligible for a 50% discount on their patent registration costs. this motivates startups and small companies to continue developing novel ideas and technologies. by applying to the relevant ministries, one may apply for the subsidy.
Tax Exemption
Numerous benefits can help you save money that could otherwise be subject to taxation. enterprises can benefit from a potential taxation basis, which relieves them of the need to maintain thorough audit procedures and comprehensive books of accounts.
Protection Against Delayed Payments
The purchasers of goods or services from SSIs or MSMEs occasionally tend to put off making payments. by granting them the ability to charge interest on delayed payments from the buyer's side, the ministry of micro, small and medium enterprise supports these businesses. such conflicts must be arbitrated and mediated within a reasonable time.
The buyer is required to make the payment within 15 days of the day they accepted the products and services from or on or before the payment date that an MSME or SCI-registered firm mutually agreed upon if any MSME-registered enterprise provides goods or services to the buyer. it is only possible if there is no mention of the date of payment.
Electricity Bill Concessions
All businesses with an MSME registration certificate are qualified for electric bill discounts. because of this, firms may increase output and accept more orders without worrying about incurring capital costs for things like electricity and maintenance. micro, small, and medium-sized businesses can apply for the concession by sending a certificate of registration and an application to the electricity department.
Reimbursement Of ISO Certification
The authorities will not charge MSME-registered businesses any ISO certificate fees if they submit an application to the appropriate authority with their registration certificate. ISO certification is required to increase the standards of MSMEs' efficiency throughout the bidding process.
HOW TO APPLY FOR MSME REGISTRATION ON UDHYAM REGISTRATION?
Businesses who want to avail benefits announced by the Government for MSMEs will need to register their business on the ‘Udyog Aadhaar Memorandum (UAM) portal’. The registration process is quite simple and free for every user.
Follow the below steps to register your business online:
Visit the Udyam registration Portal where you will be required to fill a form.
If you are registering your business as an MSME for the first time, click on the first link on the page.
Enter the Aadhaar Number and Name and click on ‘Validate & Generate OTP’.
Once verification is done, you will have to fill in the PAN details. You can select the No option if you don’t have a PAN card yet.
Post this, you will have to fill the form having field numbers 5-24.
At the end of the form, an OTP request will be sent to your phone again. Enter the OTP and verification code to submit the form successfully.
After successful registration, a “Thank You” message will appear with a Registration Number. Keep that number handy for future reference.
Once the application form is submitted, it can take 2-3 days for the approval and registration to complete.
If the application gets approved, the registration will be done and the MSME certificate will be delivered to you via email.
Please note that the MSME registration on the government portal is free of cost.
