What is MSME? How can we find an MSME certificate?

What is MSME? How can we find an MSME certificate?

To promote MSMEs, which are the backbone of the Indian economy, the MSMED Act facilitates a lot of schemes, subsidies, and incentives. To be able to benefit from these, you need to get your MSME registered, although it is not compulsory.

The full form of MSME is Micro, Small, and Medium Enterprises. These industries are the most important part of the economy of a developing country like India, MSME industries are the backbone of the economy. When these industries grow the economy of the country automatically grows as a whole and flourishes. These industries are also known as small-scale industries.

Even if the Company is in the manufacturing line or the service line, registrations for both these areas can be obtained through the MSME act. This registration is not yet made mandatory by the Government but it is beneficial to get one’s business registered under this because it provides a lot of benefits in terms of taxation, setting up the business, credit facilities, loans, etc.

The MSME became operational on October 02, 2006. It was established to promote, facilitate and develop the competitiveness of the micro, small and medium enterprises.

Details Required for the MSME Registration:

• APPLICANT NAME
• MOBILE NUMBER
• EMAIL ID
• OFFICE ADDRESS
• SOCIAL CATEGORY
• AADHAAR NUMBER
• PAN CARD NUMBER
• BANK ACCOUNT NUMBER
• IFSC CODE
• DATE OF COMMENCEMENT OF BUSINESS
• TYPE OF ORGANIZATION
• MAIN BUSINESS ACTIVITY OF ENTERPRISE
• NUMBER OF EMPLOYEES
• INVESTMENT IN PLANT & MACHINERY / EQUIPMENT

Advantages of registering in the MSMED act

Registering into the MSMED Act is not a legal requirement. But doing it offers you the following benefits

You receive collateral-free loans

The Government of India offers collateral-free loans to MSMEs all over the country. This ensures that you have the funds required to launch your dream venture. You may even use it to expand your business. This is made possible through a trust called Credit Guarantee Trust Fund Scheme. It is a concerted effort by the Government of India, the Small Industries Development Bank of India, and the Ministry of MSMEs. The trust ensures the implementation of the Credit Guarantee Scheme.

Subsidy to register patents

The government of India offers a 50% subsidy for the loans it receives if the venture is registered with MSMED Act. You may use it to apply for patent registration under the Ministry of MSMEs.

Subsidy for industrial promotion

Registering under this Act makes you eligible for Government subsidies available to promote your products and services.

Extension of interest on overdraft facility

Ventures registered under MSMED are eligible for 1% interest on the overdraft facility. The amount may vary depending on the lender you choose.

You avail low interest rates for the loans you take

In addition to the exemption on overdraft facilities, those MSMEs registered under the MSMED Act are eligible for 2% interest sub pension. These are made available for incremental loans of less than INR 10000000.

Reimbursement of charges incurred for ISO certification

MSMEs registered under the Act are eligible for the reimbursement of the cost they incur in obtaining the certifications like ISO9000, ACCP certification, etc. This is done so as to improve their performance in all sectors.

The incubation scheme for MSMEs

This is a scheme the Government of India launched in 2019. This helps aspiring entrepreneurs to develop their innovative ideas for the creation of innovative products. A venture registered in MSMED Act receives the following assistance as per this scheme:

Financial assistance of up to INR1500000 is offered to nourish an idea.

A loan of INR10000000 is offered to procure and install machinery in business intelligence. This is done with a view to strengthen the R&D activities in the field.

Financial assistance of up to INR10000000 is offered as seed capital support to BIs and His to transform their ideas into ventures. This is offered in the form of grants.

Market development scheme

The Central Government has a price and purchases preference mechanism in place. Up to 358 items are listed as per this policy. Government buys these products exclusively from MSMEs registered under the Act. The scheme offers marketing support even for those units that don’t fall in the category of reservation as per the policy.

Safeguards your business from delayed payments

Buyers may buy products or services from MSMEs and fail to pay their dues on time. In such an instance, the Ministry of MSMEs comes to your assistance. It lets them levy interest on the payment delay. A settlement here happens through arbitration and conciliation. And these issues are generally resolved within no time.

100% exemption from tax for innovative startups

If you are registered with MSMED Act and your Startup is innovative and eligible for exemption then you are exempt from all taxes for three in seven years. The turnover should not be exceeded INR 25000000 in any of these financial years. You can avail of this benefit under the Income Tax Act. As per this rule, companies are considered startups with up to ten years of service. It also allows credit for minimum tax alternatives to be carried forward for 15 years.

Lower electricity bill

Under this registration firm is eligible for concessions in electricity bills. To avail this facility, you need to apply to the Electricity Department along with the certification of registration.

Preference when inviting tenders

At regular intervals, the Government of India invites tenders. Certain numbers among them are reserved only from ventures that have MSME registration. Lately, the Government declared that competition from foreign players is nowadays getting unfair. And it will not accept global tenders in the range of INR 200000000 as an investment.

Registration process for MSME

Step-1: Start Registration Process

Click here to start the MSME Registration Process.

Step 2: Fill Application Form

APPLICANT NAME: Applicant should fill their Name as mentioned on Aadhaar card.

MOBILE NUMBER: Give correct Mobile Number of the Applicant, please avoid Country Code

EMAIL ID: Fill correct E-Mail ID of the Applicant, as Certificate & and Acknowledgement will be sent to registered Mail ID.

OFFICE ADDRESS: Applicant should Fill his/her proper office Address with State and Pin code.

SOCIAL CATEGORY: Applicant can choose social categories from the given option.

AADHAAR NUMBER: Applicant are required to mention his/her 12-digit Aadhaar number issued by UIDAI.

PAN CARD NUMBER: Applicants are required to mention their PAN Card number. (In case of proprietorship, Enter Owners Pan Number).

BANK ACCOUNT NUMBER: Fill the applicant Bank Account Number as mentioned on Passbook.

IFSC CODE: Fill the Applicant Bank IFSE Code as Mentioned on Passbook.

DATE OF COMMENCEMENT OF BUSINESS: Fill in the Date of your Company’s Incorporation or Registration, which will be printed on your certificate.

TYPE OF ORGANIZATION: Select the type of Organization from the given options, as it will get printed on the certificate.

MAIN BUSINESS ACTIVITY OF ENTERPRISE: Select the main activity from the given options.

ADDITIONAL DETAILS ABOUT BUSINESS: If you want you can fill more details about your business.

NUMBER OF EMPLOYEES: Enter the number of active Employees in your organization.

INVESTMENT IN PLANT & MACHINERY / EQUIPMENT: Enter the Applicant’s total investment in plant, machinery and equipment etc. to start his/her business.

SUBMIT APPLICATION: Click the submit button once the Applicant submitted all of required details and documents.

Step 3: Executive Will Process Application

At this process, an MSME executive will review your application. In case of any discrepancy, you will be notified about the process and make the relevant changes.

Step 4: Receive Certificate of Mail

After filling the complete form, you will get the certificate for MSME Registration. To know how it would be, you can download a copy of the Sample MSME Certificate. The Ministry will not issue you any hard copy for it. You will get a virtual certificate for MSME Registration.

This is the process for the MSME registration for companies. Note that the entire registration process is free of cost. However, there are many online portals that do the registration process on behalf of the companies at a certain fee.

NOTE: AFTER THE PAYMENT IS MADE SUCCESSFULLY DOCUMENT (AADHAAR CARD & PAN CARD) SUBMISSION WILL BE REQUIRED.