MSME Registration Benefits in India

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MSME Registration Benefits

MSME stands for micro, small and medium enterprises, and these are the backbone of any developing economy. To support and promote MSMEs, the Government of India through various subsidies, schemes and incentives promote MSMEs through the MSMED Act. To avail the benefits under the MSMED Act from Central or State Government and the Banking Sector, MSME Registration is required.

MSME Registration

MSME stands for micro, small and medium enterprises and any enterprise that falls under any of these three categories. MSME enterprises are the backbone of any economy and are an engine of economic growth, promoting equitable development for all. MSME Enterprises are typically more labour intensive than large corporates and provide tremendous employment potential at a very low capital cost. MSME also share a major portion of industrial production and exports in India and play a pivotal role in the development of industrial economy.
Therefore, to promote and develop MSMEs; the MSMED Act of India facilitates promotion and development of enterprises through many incentives, schemes and subsidies. To obtain the benefits under MSMED Act, MSME Registration is a must and proprietorship firms, partnership firms, LLPs, Private Limited Company’s and Public Limited Companies can register.

BENEFITS OF MSME REGISTRATION

The MSME registration is not statutory. However, the MSME registration process in India has been conceptualized to provide maximum benefits to all types of enterprises. After registration, any enterprise becomes qualified to reap the benefits offered under the MSMED Act. Some of the benefits from Central Government include easy sanction of bank loans (Priority sector lending), lower rates of interest, excise exemption scheme, exemption under Direct Tax Laws and  statutory support such as reservation and the interest on Delayed Payments Act.
State Government and Union Territories also have complied their own package of facilities and incentives for MSMEs. Some of the benefits provided by State Govenement for MSMEs include development of specialized industrial estates, tax subsidies, power tariff subsidies, capital investment subsidies and other support. Both the Centre and the State, whether under law or otherwise, target their incentives and support packages generally to units registered with them.
Banking Laws, Excise Law and the Direct Taxes Law have incorporated the word MSME in their exemption notifications. Therefore, the registration certificate issued by the registering authority is seen as proof of being MSME and is required to avail the benefits sanctioned for MSMEs.

MSME Definition

MSME Classification in India
MSME Classification in India
For Enterprises engaged in the manufacture or production, processing or preservation of goods, the definition is as follows:
  • Micro Enterprise: An enterprise where investment in plant and machinery does not exceed Rs. 25 lakh.
  • Small Enterprise: An enterprise where the investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore.
  • Medium Enterprise:  An enterprise where the investment in plant and machinery is more than Rs.5 crore but does not exceed Rs.10 crore.

In case of the above enterprises, investment in plant and machinery is the original cost excluding land and building and other items as specified by the Ministry of Small Scale Industries.

For Enterprises engaged in providing or rendering of services, the definition is as follows:
  • Micro Enterprise: An enterprise where the investment in equipment does not exceed Rs. 10 lakh.
  • Small Enterprise: An enterprise where the investment in equipment is more than Rs.10 lakh but does not exceed Rs. 2 crore.
  • Medium Enterprise: An enterprise where the investment in equipment is more than Rs. 2 crore but does not exceed Rs. 5 crore.
To obtain MSME Registration, visit IndiaFilings.com

Comments (13)

vilayat Ali

Jan 18, 2015 at 9:24 AM

I need low interest credit to start my own unit at kargil my home town ,,,pls suggest ,,

Reply

Aditya So Mech

May 06, 2015 at 12:34 PM

We are doing in total soap making machines manufuctures, the industry will have to s s i certificate so kindly request.

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TAPAN MOHANTY

May 13, 2015 at 6:19 PM

pls suggest me how to take a franchisee of snapdeal at puri.

Reply

satyendra kumar

May 22, 2015 at 7:32 PM

i m start the mashala packing company . so help

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N.K.Devanandan

Jun 01, 2015 at 2:41 PM

Whether for TNPHC tenders emd the MSME has eligible or not pls clarify

Reply

Felix Coutinho

Oct 04, 2015 at 6:09 PM

I want to start a car wash business can you please help and suggest

Reply

Sunil jain

Oct 12, 2015 at 5:49 PM

I want to register as msme at Delhi NCR for service industry & want to know the benefit of msme.

Reply

Suresh Sharma

Oct 30, 2015 at 2:45 PM

Hi

My company name is

Samtech Engineering & Composites Pvt Ltd

SSI No 090101107291 Dated 8th July 2014

DIC Gautam Budha Nagar UP

I want to know validity of this certificate

Also what is the procedure in case of change in address

Reply

sujit

Apr 17, 2017 at 10:14 AM

I have a msme certificate can i open a school for students the government is give the loan 25 lakhs

Reply

Karthik

Dec 07, 2017 at 4:13 PM

Can mobile recharge shop owner get msme registration?

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