MSME Registration Benefits in India
Msme Registration Benefits In India
MSME stands for micro, small and medium enterprises, and these are the backbone of our country and are an engine of economic growth, promoting equitable development for all. To support and promote MSMEs, the Government of India, through various subsidies, schemes, and incentives, promote MSMEs through the MSMED Act. To avail of the benefits under the MSMED Act from the Central or State Government and the Banking Sector, MSME Udyam Registration is required.
Benefits of Udyam Registration for MSME
The Government of India, Ministry of Micro, Small and Medium Enterprises (MSME) vide Gazette of India notified composite criteria consisting of investment and turnover for classifying the enterprises as Micro, Small and Medium Enterprises 2020. Confirming the new definition of MSMEs and ease of doing business would facilitate MSMEs for a permanent Registration, i.e., Udyam Registration.
Click here to know more about the MSME-Udayam Registration
Salient features of Udyam Registration
Anyone can obtain the Udyam Registration for the enterprise. It can be registered through the official portal of Udyam.
- The process for Udyam Registration is fully Paperless.
- And digitalized. The applicant does not need to upload any documents.
- The registration process is free. No Fees are to be paid to anyone.
- An e-certificate, namely, the “Udyam Registration Certificate,” shall be issued on completion of the registration process. This UR certificate will have a dynamic QR Code from which the details about the enterprise can be accessed.
- Whoever intentionally misrepresents in the Udyam Registration or updating process shall be liable to a penalty as prescribed under section 27 of the MSME Act.
- The Udayam online system is fully integrated with Income Tax and Goods and Service Tax Identification Number (GSTIN) systems; details on investment and turnover of enterprises are taken automatically from Government databases.
- Exports are not taken as part of the turnover calculation.
Requirement for Registration
- Only an Aadhar number is enough for Registration
- Having PAN & GST numbers is mandatory
Benefits of Udyam Registration
- It will be a permanent registration and primary identification number for an enterprise.
- MSME Registration is paperless and based on self-declaration.
- Udyam registration is permanent, and there will be no need for renewal of Registration.
- Any activities, including manufacturing, service, or both, may be specified in one Udayam Registration.
- Enterprises may register themselves on GeM (Government e Portal (a portal to address issues relating to delay in payments) along with the Udyam Registration, and simultaneously, MSMEs themselves can also onboard on the TReDS Platform (the invoices of receivables are traded on this platform) through three available platforms, i.e., 1. www.invoicemart.com www.m1xchange.com 3. www. rxil.in
- The Udyam Registration may also help MSMEs in availing the benefits of the following Schemes of the Ministry of MSMEs :
- Credit Guarantee Scheme
- Public Procurement Policy
- Additional edge in Government Tenders & Protection against delayed payments
- Udyam registered entity becomes eligible for priority sector lending from Banks.
Priority Sector Lending Benefits to MSME
- The Reserve Bank of India issues the Priority Sector Lending (PSL) guidelines.
- Accordingly, the categories under the priority sector are as follows:
- Micro, Small, and Medium Enterprises
- Export Credit
- Social Infrastructure
- Renewable energy
- MSME Sector falls under Priority Sector Lending
All bank loans to MSMEs conforming to the RBI guidelines qualify for classification under priority sector lending.
Benefits for Udyam Registered Entity
The benefits offered to Udyam Registered Entity are listed as follows:
- MSMEs Get Benefits From Bank: After the introduction of Udyam registration, all banks and even financial institutions are prioritizing micro, small and medium-sized business enterprises and making special plans for them. MSMEs can easily get a business loan at a very lower interest rate, Upto 1.5 percent lower than interest on regular business loans.
- Amazing Tax Benefits: Depending on their business industry, business owners can benefit from the excise exemption scheme. They can get direct tax exemption in the beginning years of their business.
- Benefits of Electricity Bills: Small business owners registered on the Udyam portal can get some concessions on their monthly electricity bills and save their resources.
- Approval of Licenses: For businesses, it has become very easy to apply for and get approval on various registrations and licenses if registered with Udyam.
- SMEs Can Apply For Government Tenders Easily: MSMEs registered under this Registration are permitted to participate in government tenders and can avail of exemption while applying.
- Interest in Overdraft (OD): MSMEs are eligible under the credit guarantee trust fund scheme to get an advantage on OD and an exemption of 1 percent interest. This minimizes your loan EMI.
- State Government Benefits: The state governments provide subsidies on tax, electricity, and entry to the business sectors and rebates in sales tax and buying preference for the goods they leave.
- The Central Government Benefits: The central government has introduced various beneficial schemes for MSMEs such as Atma Nirbhar Bharat, credit guarantee scheme, Quality management standard & quality technology tools, women entrepreneurs, zero effect and zero defect, and many others.
- International Business Opportunity: MSMEs can benefit from the opportunity to participate in international fairs and trade shows where they can display their products & services to a broader global audience.
- Get Benefits from Subsidies: MSMEs can avail subsidy from National Small Industries Corporation or NSIC as well as credit ratings and are eligible for Industrial Promotion Subsidy (IPS) subsidy.
Post by IndiaFilings
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