12 Months Moratorium/Waiver on Loan Repayment.Fully covered under Govt. guarantee. No guarantee fee will be charged. Scheme available till 31st Oct, 2020.
Govt. will provide equity funding/invest in shares of MSMEs with growth potential through Fund of Funds scheme.
Govt. will help to expand MSME size as well as capacity,will encourage MSMEs to get listed on main board of Stock Exchanges.
The Government of India gives special preference in buying from Micro and Small businesses through Govt.tenders.
Enterprises that have MSME Registration can avail benefit of 1% exemption on interest rate on over draft (OD).
Enterprises that have MSME Registration Certificate can avail Concession on electricity bill by making application to electricity department
Maximum period for payment for purchases from MSME shall not exceed 45 days, in case of delay, the buyer is liable to pay interest to the SME supplier, at 3 times of the bank rate.
Enterprises that have MSME Certificate can avail 50% subsidy for patent & trademark registration.
Enterprises undergoing a dispute with regard to payments may refer the dispute to the MSME Facilitation Council for conciliation & arbitration.
| CLASSIFICATION | MICRO | SMALL | MEDIUM |
|---|---|---|---|
| Manufacturing & Services | Investment Less than Rs. 1 Crore And Turnover Less than Rs. 5 Crore | Investment Less than Rs. 10 Crore and Turnover Less than Rs. 50 Crore | Investment Less than Rs. 50 Crore and Turnover Less than Rs. 250 Crore |
*Old classification had different criteria for Manufacturing & Services. Only had Investment as criteria. Micro- 25/10 Lac,Small 5/2 crore & Medium 10/5 crore for Manufacturing/Services sector respectively.
Scanned copy of PAN Card of all directors and Voter ID/ Passport/ Driving License
Partnership business would have to submit a copy of the partnership deed and registration certificate (if registered). A company might have to submit a copy of their AoA and MoA. Also, the copy of the general meeting resolution and board meeting resolution that authorises the director to sign the MSME application might have to be attached.
Notarised rent agreement and No Objection Certificate from the owner (for a rented office), Property registration, House Tax (for an owned property) and Utility Bill (no older than 2 months).
Copies of the sale bills of all the finished goods and purchase bills of all raw materials of the business will have to be submitted. Additionally, bills related to the purchase and installation of plant and machinery and copies of the company’s industrial licensing (if applicable) might have to be submitted.
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| Government Fee | Rs 0 |
| Professional Fees | Rs 2,459 |
| Total Cost inc. GST | Rs 1,199 |
GST registration certificate with ARN and GSTIN number
An acknowledgement slip with payment details
MSME stands for Micro Small and Medium Enterprises. The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, to boost the small businesses. MSMEs in the manufacturing and service enterprises can obtain the registration under the Act.
Any type of business entity such as proprietorships, HUFs, partnerships, OPCs, LLPs or private limited companies can be classified as an MSME as per the MSMED Act, 2006, and are eligible to apply for the MSME online certification. The classifications of the MSMEs are based on the investment in plant and machinery.
For manufacturing entities:
Type of Unit | Investment in Plant and Machinery |
|---|---|
| Micro Enterprises | Not more than Rs.25 Lakhs |
| Small Enterprises | INR 25 Lakhs to INR 5 Crores |
| Medium Enterprises | INR 5 Crores to INR 10 Crores |
For service provider entities
Type of Unit | Investment in Plan and Machinery |
|---|---|
| Micro Enterprises | Not more than Rs.10 Lakhs |
| Small Enterprises | INR 10 Lakhs to INR 2 Crores |
| Medium Enterprises | INR 2 Crores to INR 5 Crores |
MSMEs get loans, credit, and overdraft facilities from the bank at subsidised rates as compared to other regular companies. MSME also have comparatively higher possibilities of securing loans and enjoy exclusive schemes.
The enterprises register MSME to avail the benefits of:
As per the MSMED Act, the MSME registration is voluntary. However, it is advisable to register under MSME Act, as it opens up a host of benefits. The purpose of the MSME / UDYOG AADHAR registration is to avail the benefits and subsidies provided by the government.
The provisional MSME registration certificate is valid for five years. As soon as you set up the business unit, you can apply for the permanent license. The permanent registration certificate is valid for a lifetime period. But, if you are unable to set up the unit within five years or the unit exceed the investment limit then you may re-apply for the MSME certificate.
The act divided the MSMEs into two categories:
These enterprises are further sub-divided into Micro, Small and Medium enterprises based on their investment in plant and machinery.
Online MSME registration is at the discretion of the business owner. However, it is advisable to obtain MSME registration right after the incorporation in order to avail the benefits of the subsidies and schemes.
Commercial banks can grant composite loans within a limit of INR 1 Crore. MSMEs can use this loan to avail working capital requirements and avoid delay in commencement of commercial production.
While calculating the investment value, land and building will not be counted as investment. For a manufacturing unit, the cost of plant and machinery above Rs.25 crore and for a service unit cost of plant and machinery above Rs. 10 crores are not counted as an investment. Also, depreciation will not be deducted from the cost of plant and machinery. The original value will be taken into consideration.
There are certain facilities and subsidies including tax subsidies, power tariffs subsidies and capital investment subsidies, which are available to only registered MSMEs.
CGTMSE is a scheme available for registered MSMEs. Under this scheme, banks offer the finance with the limit of INR 100 lakhs without any collateral security. Every bank recognised under MSME Act has separate ceiling limits for financing MSMEs under the CGTMSE Scheme.
The Government adopted the cluster development approach to enhance the production and competition, as well as capacity building of MSMEs. Clustering of units enables the service providers to provide services more economically.
No, the whole MSME enterprise registration process is done online. You can send the scanned copies of all the required incorporation documents. All the forms and documents are filed electronically and are digitally signed.
Obtaining the MSME/ SSI registration is not mandatory but it’s a preferable alternative to reap the advantages available to micro, small and medium scale enterprises.
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