MSME Udyam
According to the Government of India, MSME refers only to manufacturing and service businesses, with trading companies excluded. The MSMED Act 2006 divides businesses into Manufacturing Enterprises and Service Enterprises based on their definition and categorization, as well as the registration regulation applicable to the Central and State governments. Manufacturing enterprises manufacture and produce goods, whereas service enterprises provide a variety of services.
Eligibility for MSME Plan
To be eligible for the MSME plan, industries must meet the Ministry of Micro, Small, and Medium Enterprises’ qualifying criteria. These eligibility criteria vary depending on the investment in plant and machinery/equipment and turnover for Micro-Enterprise, Small-Enterprise, and Medium-Enterprise.
- The investment in machinery/equipment for a Micro-Enterprise should not exceed Rs. 1 crore, and the turnover should be less than Rs. 5 crore.
- Small enterprises should invest not more than Rs. 10 crores in machinery/equipment, and their turnover should not exceed Rs. 50 crores.
- Medium enterprises should invest not more than Rs. 50 crores and their turnover should not exceed Rs. 250 crores.
Revised Classification applicable w.e.f 1st July 2020
Composite Criteria: Investment in Plant & Machinery/equipment and Annual Turnover
| CLASSIFICATION | MICRO | SMALL | MEDIUM |
|---|---|---|---|
| Manufacturing Enterprises and Enterprises rendering Services | Investment in Plant and Machinery or Equipment: Not more than Rs.1 crore and Annual Turnover: not more than Rs. 5 crore | Investment in Plant and Machinery or Equipment: Not more than Rs.10 crore and Annual Turnover: not more than Rs. 50 crore | Investment in Plant and Machinery or Equipment: Not more than Rs.50 crore and Annual Turnover: not more than Rs. 250 crore |
Benefits of MSME Registration Online
Before beginning the registration procedure, it is critical to understand why MSME registration online is advantageous:
- Credit: MSMEs with a valid registration can obtain lower-interest loans from a variety of financial institutions.
- Government Schemes: Registered MSMEs can take advantage of government schemes and subsidies that help lower operational expenses and encourage growth.
- Priority financing: Banks are required to lend a specific amount of their overall credit to MSMEs, and registration makes such priority financing more accessible.
- Technology Upgrade Subsidies: MSMEs can receive subsidies to upgrade their technology and improve their competitiveness.
- Market Preference: Many government tenders and procurement opportunities are frequently designated for MSMEs, providing them with a competitive advantage.
- Ease of Obtaining Licences: MSME registration Online makes it easier to obtain licenses and permits.
Documents Required for MSME Registration Online
During the application process, you may need to upload supporting documents such as your Aadhaar card, PAN card, address proof, and Company Bank account Details. The Udyam Registration Portal seamlessly retrieves PAN and GST-linked details from Government databases, thanks to its integration with the Income Tax and GSTIN systems.
Notably, GST registration is optional for enterprises not requiring it; however, those mandated to obtain GST registration under the GST law must input their GSTIN for MSME or Udyam Registration.
Which Entities are eligible for MSME Online?
- Individuals, startups, business owners, and entrepreneurs
- Private and public limited companies
- Sole proprietorship
- Partnership firm
- Limited Liability Partnerships (LLPs)
- Self Help Groups (SHGs)
- Co-operative societies
- Trusts
